A launch window for India as a space start-up hub

Newspaper Rainbow Series     30th November 2021     Save    
QEP Pocket Notes

Context: The space sector in India is in an embryonic stage and there is scope to build a feasible business model.

Hurdles in Indian space economy

  • India, a very marginal player in space economy: India is having less than 2% share in the space economy sector.
    • While total early-stage investments in space technologies in FY21 were $68 billion.
    • India was on fourth place with investments in about 110 firms, totalling not more than $2 billion.
  • Extensive brain-drain, which has increased by 85% since 2005 making it difficult for private space ventures to find right talents.
  • Bottlenecks in policies which create hindrances for private space ventures and founders to attract investors, making it virtually non-feasible to operate in India.
    • Absence of a framework to provide transparency and clarity in laws is the reason for the lack of independent private participation in space.


Way forward: 

  • Transparent and clear laws: The laws need to be broken down into multiple sections, each to address specific parts of the value chain and in accordance with various international treaty like 
    • Outer Space Treaty, United Nations resolution, the Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, etc.
  • Division of space activities into upstream and downstream space blocks that will allow legislators to provide a solid foundation to products/services developed by the non-governmental and private sectors within the value chain.
  • Licencing space business: As there are various technicalities involved in space business, timelines on licensing, issuance of authorisation and continuous supervision mechanism need to be defined into phases.
    • Eg. In France, where there are four obtainable licences in addition to case-by-case authorisation, with lack of clarity surrounding costs.
  • Insurance and indemnification clarity in case of a mishap: In several western countries with an evolved private space industry, there is a cap on liability and the financial damages that need to be paid. 
    • Eg. In Australia, space operators are required to hold insurance of up to AUD$100 million under Australian space law.
  • Private entities should be part of the system: Indian space private companies need to generate their intellectual property for an independent product or service (e.g. satellite-based broadband).
    • Mature space agencies such as the NASA , CNSA, and  Roscosmos  seek support from private players such as Boeing, SpaceX and Blue Origin for complex operations beyond manufacturing support, such as sending crew and supplies to the International Space Station.
  • Building a space ecosystem and with ISRO being the guiding body: India can now evolve as a space start-up hub for the world.

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QEP Pocket Notes