News Highlight
India’s space economy peaked at $9.6 billion in 2020 and is expected to reach $12.8 billion by 2025.
Key Takeaway
- The report titled ‘Developing the Space Ecosystem in India: Focusing on Inclusive Growth’ predicts it.
- The satellite launch services segment will witness the fastest growth due to increasing private participation.
- The growing demand for smaller satellites is set to boost satellite manufacturing in the country.
India’s Space Economy
- According to the Indian Institute of Space Science and Technology (IIST) research project, India’s space economy has evolved considerably and now accounts for about 0.23% of the GDP.
- The space economy’s main segments include manufacturing, satellite operators’ services and consumer services.
The need to focus on the Space Economy
- Huge untapped potential:
- India manages to occupy only 2% of the global space economy. The small share isn’t solely due to technology and resources but also policy.
- Boosting the Economy:
- Allowing private entities into end-to-end space activity would help achieve a US$ 5 trillion economy by 2024. Further, the space economy market is said to grow by over US$ 1 trillion by 2040.
- Low Cost:
- The Indian space sector has the potential to launch space vehicles at a much lower cost. This was seen in the Mars Orbiter Mission, which was ten times cheaper than western missions. This will help in getting many foreign contracts.
- The availability of low-cost satellite launch vehicles and mass production will lead to a demand from customers worldwide.
- Rising Demand:
- It is estimated that around 10,000 satellites will be launched into low-earth orbit by 2026.
- This provides ample opportunities for small and medium enterprises to enter the sector.
- Space tourism:
- Space tourism is human space travel for recreational purposes. Nowadays, space tourism is gaining prominence.
Steps have been taken to boost the Space Economy.
- Indian Space Association (ISpA):
- It will be represented by leading domestic and global corporations that have advanced capabilities in space and satellite technologies.
- Indian National Space Promotion and Authorisation Centre (IN-SPACe):
- It aims to provide a level-playing field for private companies to use the Indian space architecture.
- Opening the Space Sector:
- The Government 2020 opened up the Space sector allowing the participation of the Indian private sector in the entire domain of space activities.
- This includes satellite creation, launches, and space-based services previously not open to them.
- Antrix Corporation:
- It is a government-owned company under the administrative control of the Department of Space.
- It was established in 1992 to commercially utilise space products of ISRO, providing technical consultancy services and transferring technologies to industry.
- New Space India Limited (NSIL):
- It is a Central Public Sector Enterprise under the Department of Space that was established in 2019.
- It has been mandated to transfer the technologies emanating from the Indian space programme and enable the Indian industry to scale up its high-technology manufacturing base.
- Draft Space Activities Bill, 2017:
- It focuses on encouraging the participation of private sector agencies under the guidance and authorisation of the government through the Department of Space.
The challenges in the development of the Space Economy
- Brain Drain:
- India produces the best brains in the world but cannot retain them. As a result, people emigrate from the country for better opportunities and careers that might hamper the development of the space sector.
- Budgetary Constraints:
- There was a decline in the budget for space-related activities. This led to a space economy size reduction in the last two years. The budget outlay in 2020-21 was INR 9,500 crore, shrinking from INR 13,033.2 crore in the previous fiscal.
- Foreign competition:
- Particularly for the launch of small satellites, which is an expanding market. The Elon Musk-owned SpaceX Falcon 9 is widely considered a serious potential threat to ISRO’s Polar Satellite Launch Vehicle (PSLV) workhorse.
- Space Debris:
- Since the market is open, more corporations can send their vehicles and satellites into space, which is already crowded. By some estimates, there are over 15,000 traceable and over 200,000 1-10 cm pieces.
- Absence of a Legislative Framework:
- The draft Space Activities bill was introduced in 2017 but had been pending.
Way forward
- Policies:
- The policies of opening the space sector to private players should be duly implemented.
- International collaborations:
- The government should also enhance collaboration between Indian private players and big private players from across the globe, like SpaceX, Virgin Galactic etc.
- Investment promotion:
- The Foreign direct investment (FDI) reform is crucial to decentralise investments further.
- The IN-SPACe needs to act on its mandate and allow foreign entities and domestic innovators to get around the bureaucracy.
- Space debris:
- In the case of space debris, coordination between the public and private sectors will come into play.
- The government can decide exactly how many programmes can be allowed in space and if they can partner in removing space debris.
- The commercialisation of small satellites:
- The Indian Space Research Organisation (ISRO) can pave the way for the commercialisation of small satellites by the private sector.
- Better incentive:
- Better incentives and facilities for youngsters working in the Indian space economy would help reduce the Brain drain problem.
Content Source: Live mint