Encouraging private participation could free up ISRO to focus on research and development, interplanetary exploration and strategic launches

India is rapidly advancing in space exploration, having achieved the feat of landing on the Moon’s south pole and garnering a reputation as a cost-competitive space industry. The country's space programme is gaining global recognition in the field of science and engineering and is playing a vital role in exploring new frontiers.

The Indian Space Research Organisation (ISRO), the world's sixth-largest space agency, spent only Rs 613 crore ($74 million) on the successful Chandrayaan-3, which is less than the cost ($200 million) of the failed Chandrayaan-2, in 2019. In contrast, China spent $12 billion on its Moon programme in 2022, while NASA, the world's largest space agency, is on track to spend $93 billion (Rs 7.72 lakh crore) on its Artemis Moon programme, and is now seeking collaboration with ISRO for its future Moon Mission.

Despite having a mere 2% share in the global space economy, India's reputation for cost-effective engineering has caught the attention of the world superpower US, which has a 40% share in the same. The success of Chandrayaan-3 will undoubtedly benefit India's space business, and its next space milestone mission Gaganyaan including a Venus Orbiter Mission, a Mars Lander, setting up an Indian Space Station by 2035, and sending the first Indian to the Moon by 2040.

The current competition to explore a previously uncharted region of the Moon is reminiscent of the space race between the United States and the Soviet Union in the 1960s. However, unlike then, space exploration is now a competitive industry, with the Moon's south pole being a highly coveted destination due to the presence of water ice that could potentially support future lunar colonies, mining operations, and even expeditions to Mars.

The global space economy is projected to increase from $546 billion to $1 trillion by 2040. NASA has paved the way for private players to participate in space exploration. India has also entered the race by privatising space launches and is now considering opening the sector to foreign investment, to increase its share in the global launch market by five times in the next decade.

The space economy is growing rapidly, with the entry of private players and 100% Foreign Direct Investment (FDI). This will lead to the adoption of newer, more efficient technologies that are also cost-effective in the space sector. The Indian Space Policy-2023 and the Indian Space Activities Bill provide a framework that prioritises private players' involvement in the space sector. This will help India increase its share in the global space economy from 2% to 9% by 2030, according to a recent report by Deloitte India.

India's current space sector is valued at approximately $8 billion and has been growing at a rate of about 4% per year, which is higher than the global average of 2%. It is expected to reach $40 billion by 2040. With the successful Chandrayaan-3 mission, India can achieve this target much earlier, as it is likely to receive requests from NASA and other countries for satellite launches.

Cost competitiveness 

The Indian National Space Promotion and Authorisation Centre (IN-SPACe) and NewSpace India Ltd (NSIL) have been transferring existing technologies to the private sector since 2020. Their goal is to create an ecosystem of industry, academia, and start-ups and attract a larger share of the global space economy. The Department of Space has helped emerging companies build upon ISRO's foundational technologies to reduce their development time and costs. They have also provided guidance to help these companies build advanced technologies with a robust foundation of space infrastructure, a repository of existing technologies, and active support to enable a seamless fusion of traditional expertise and modern innovation.

Globally, private players in space are on the rise due to commercial benefits. Companies like Elon Musk's SpaceX are developing the Starship rocket for their satellite launch business and to ferry NASA astronauts to the moon's surface under a $3 billion contract. Beyond that contract, SpaceX plans to spend approximately $2 billion on Starship this year. US space firms Astrobotic and Intuitive Machines are building lunar landers expected to launch to the moon's south pole by year's end or in 2024. NASA aims to map the lunar south pole and its water ice by 2024. Companies such as Axiom Space and Jeff Bezos' Blue Origin are developing privately funded successors to the International Space Station.

As a potential industry: The space industry has the potential to transform various sectors such as telecommunications, governance, agriculture, health, education, infrastructure, navigation, and strategic defence. Through technological advancements and innovation, space applications can bring tangible benefits to every citizen's life. Empowering the private sector amplifies the socio-economic impact of space applications. By finding innovative solutions to pressing challenges in areas such as agriculture, disaster management, or communication, the private sector can bring significant improvement to people's lives.

The way forward: India's space industry comprises a significant number of small and medium-sized enterprises (SMEs) that supply parts and components for satellite and launch vehicle manufacturing. This sector supports the government's vision of 'Atmanirbhar India' and 'Make in India,' which aims to make India a leader in the global space industry. However, private players have so far been limited to being vendors or suppliers to the government's space program. Encouraging private participation could free up the ISRO to focus on science, research and development, interplanetary exploration, and strategic launches. Therefore, there is a need for Non-Governmental Entities (NGEs) to participate in the Indian space programme and boost India's market share in the Global Space Economy.

Expanding ISRO's collaborations with start-up products to more remote institutes and research labs is necessary. Additionally, the Production Linked Incentive (PLI) scheme and customs exemptions can cost-effectively encourage indigenous manufacturing capacity. Furthermore, a comprehensive study on fully tapping the downstream capabilities of this sector is equally important to make India a sunrise global space industry and tap the potential of young entrepreneurs to create more employment opportunities.

(The author is vice-chairman of Sonalika Group, Vice-Chairman of the Punjab Economic Policy and Planning Board, and Chairman of Assocham Northern Region Development. Views expressed are strictly personal)