Indian Space Policy 2023 in the New era of India’s space sector

Indian Space Policy 2023 in the New era of India’s space sector

Source – The Hindu and PIB.

General Studies – Science and Technology, ISRO, Department of Space, Indian Space Policy 2023, New Space India Limited, IN- SPACe , Private Sector Participation in India’s Space Policy.

Why in the News ?

  • Government of India, on 21 February 2024, 100 per cent in “manufacturing of components and systems/sub-systems for satellites, ground segment and user segment” – up to 74 per cent in satellite-manufacturing, operations and data products; And opened the door for foreign direct investment (FDI) up to 49 per cent in launch vehicles, space ports and their related systems.
  • India’s journey of achievement and development in the space sector is growing rapidly. At present, India has taken many important steps in its space program which are taking this field to new heights.
  • Recently, the Government of India has allowed private companies to participate in India’s space sector and the space policy has been reformed. This will help in attracting new investors and development of new technological products and services in the space sector.
  • India has allowed foreign direct investment (FDI) to private companies in the space sector, which can provide higher capital for new and innovative projects in this sector. This policy can help India position itself more positively in the competition with China in the space sector.
  • Encouraging private companies in the space sector will ensure that new technological products and services continue to be developed that support space research, satellite services, and other space operations.
  • India has begun to move on this path with state-led reforms in the 2020s. Through this, India has opened its space sector to private companies and new policies like ‘Geospatial Guidelines’ and ‘Indian Space Policy’ have been implemented.
  • The government is focusing on the need to maintain a clear regulatory environment, reduce red tape, increase public support and ease access for Indian companies to foreign markets. Along with this, measures are also being taken to promote public support and access of private companies to foreign markets.
  • India has taken steps to strengthen its presence in the space sector and giving a role to private companies in this will support them even more positively. With this, new possibilities can be faced in the space sector and India can become a world class space power.
  • India’s space sector is beginning a new era in which the private sector is also getting a larger share.
  • In this new round, the government has opened the door for foreign investment in manufacturing of satellites, ground segment, components and systems/subsystems for the user segment. This will provide an opportunity to private companies to invest in large amounts and will help in developing this sector. This will make India more capable of competing with China in the space sector and will motivate foreign investors to invest in India.
  • Indian start-ups have invested a “significant” portion of the US$37.1 billion raised globally in 2021-23 as space start-ups. This will help these companies to grow and attract new investors.

The Indian space sector began with success in various spacecraft and satellite launches. India has taken many important steps for development and improvement in the space sector. Therefore, some important reforms adopted by India for development in space sector are as follows – 

  1. Adopting policy and corrective initiatives for manufacturing advanced technological products in the space sector : India has adopted new policies in the space sector in which private companies have got the opportunity to participate in the space sector. This is leading to creation of new and advanced technological products and is also developing expertise in the space sector.
  2. Indian Space Policy : According to the Indian space policy, private companies can also operate in various space-related sectors such as satellite manufacturing, satellite operations, and data products.
  3. Telecommunications Act 2023 : By this Act, India has made provision to promote satellite broadband services, which will also provide space related facilities to the common people.
  4. Opening doors for private investment : India has opened the door to promote private investment for research and technological development in the space sector, allowing various world-class companies to invest in research in the Indian space sector.
  5. To provide incentives to set up start-ups in the space sector :  Facilities are being provided to set up various types of start-ups in the field of space in India, thereby promoting various new and advanced ideas in the field of space to India.
  • India is taking positive steps for the development of its space sector and is becoming a world class champion by involving private companies in it.
  • The financial, socio-economic and geopolitical implications of space have replaced romantic notions of space. Space-related technologies and spaceflight are expensive and risky endeavors in which for decades only national agencies were qualified to engage. This is no longer true as private sector companies are increasingly expected to play complementary, enhancing and/or leading roles by identifying market opportunities and innovating rapidly.

Indian Space Policy 2023 :


  • The Indian Space Research Organization (ISRO) this year released the Indian Space Policy 2023, on which it had been working for a few years. The policy has been welcomed as a progress towards India’s entry into the new space age.
  • Until the early 1990s, India’s space industry and space economy were defined by ISRO. In these, private sector participation was limited to supporting ISRO’s design and specifications.
  • The Indian Space Policy 2023 is an initiative by the Government of India to allow entry of private enterprises in all activities ranging from launching satellites and rockets into space to operating earth stations.

India has also taken several steps to improve the space sector in the past. Which are as follows –

  1. First Satellite Communication Policy : This policy was introduced in 1997, in which guidelines were issued regarding Foreign Direct Investment (FDI) in the satellite industry. However, it was later liberalized, but First in private sector towards satellite communication policy There was not much enthusiasm to be seen.
  2. Remote Sensing Data Policy : This policy was introduced in 2001, revised in 2011 and then replaced as the National Geospatial Policy in 2016, further liberalized in 2022. .
  3. Draft Space Activities Bill : This bill was introduced in 2017, which lapsed with the dissolution of the then Lok Sabha in 2019. The Government of India was expected to introduce a new bill in the year 2021, but the Government of India seems to be probably satisfied with the new policy issued by ISRO.

Reasons for India’s involvement of private investors in the space sector :

  1. Backwardness of India :  India’s share in the global space economy is low, and this can be strengthened by India involving private sector investors.
  2. Tapping the full potential of the Indian space sector :  Promoting this can increase India’s space economy, thereby creating more employment opportunities.
  3. Revolution initiated by the private sector in the space sector :  Promoting private companies can revolutionize new technological and entrepreneurial areas in the space sector.
  4. Safety and Security : Use of indigenous satellites by India can improve self-reliance in the security and defense sector.
  5. Promoting entrepreneurship in the space sector : Promoting private companies in India’s space sector can make Indian youth and entrepreneurs more interested in the field of entrepreneurship in the space sector.
  6. To make the Indian space industry at par with global industry : Encouraging the private sector may have the potential to keep the Indian space program a seller in the global space market.
  7. Improvement in economy : Inclusion of private investors can increase the space economy, thereby strengthening India’s position at the international level.
  8. Achieving self-reliance in the space sector : With the support of private sector investors, India can achieve self-reliance in the space sector.
  9. Creation of employment opportunities :  The growth of the private sector in India’s space sector can create new employment opportunities, which can create a vibrant sector for youth and entrepreneurship.
  10. Support in global competition : Promoting the private sector can make India’s space program globally competitive.
  11. Promoting private entrepreneurship in space and high technology : Enabling Indian youth and entrepreneurs in private sector activities in India’s space sector can lead to new innovations for new energy and products in the high technology sector.
  12. Improvement in science and technology in space sector :  India’s partnership with the private sector can improve new technologies and science in the space sector.

Thus, by involving private sector investors, India can move forward in the space sector and become more powerful in the global space market.

Objective of Indian Space Policy 2023 :


The objective of the Indian Space Policy 2023 is to – ‘Enable, encourage and develop a thriving commercial presence in space. A summary of the main points of this policy can be provided:

  1. Indian National Space Augmentation and Authorization Center (In SPACe) : Under this policy, InSPACe has been created which will act as a single window clearance and authorization for space launches, launch pad establishment, purchase and sale of satellites and high-resolution data dissemination. This will also include partnerships with non-governmental bodies and government companies. InSPACe will create a stable and predictable regulatory framework.
  2. New Space India Limited (NSIL) : Its purpose is to be responsible for the commercialization of space-related components, technologies, and platforms as well as the buying and selling of created space technologies.
  3. Department of Space : This department provides overall policy formulation and guidelines related to India’s space sector and is the nodal department for implementing space technologies in India. It will also work with the Ministry of External Affairs towards international cooperation and coordination in the field of global space governance and programmes. The objective of this department is to create a mechanism to resolve disputes related to space activities.
  4. Role of ISRO :  According to this policy, ISRO will now get a chance to move out of the traditional role with industries and transfer mature systems for commercial use. This will give ISRO the opportunity to develop more technologies, new systems, and finance long-term projects.

Thus, the Indian Space Policy 2023 aims to take significant steps towards a prosperous and developed space sector.

Result of investment by private sector in India’s space sector :


  • With investment by the private sector in the space sector in India, it is playing an important role in space activities.
  • In this, established private sector companies (NGEs) are obtaining permission to set up and conduct all types of activities in the space sector.
  • This includes space objects, ground-based assets, communications, remote sensing, navigation, and other related services.
  • Satellites can be self-owned and can be bought or leased with investment by private sector investors.
  • Communication services can be received from India or abroad and remote sensing data can be transmitted within India or abroad.
  • NGEs can design and operate launch vehicles and establish their own infrastructure for space transportation.
  • NGEs can now file with the International Telecommunication Union (ITU) and facilitate the commercial return of satellite resources. This gives them international recognition and an opportunity to collaborate with various organizations.
  • This makes it clear that the entire scope of space activities is now open to the private sector. Security agencies may task NGEs to provide solutions to meet specific needs.
  • The private sector in India’s space exploration and research has given a new direction to the space activities and can help in providing a viable solution to meet the specific needs of India’s security agencies.

Shortcomings prevalent in the policy of investment by private sector investors in the space sector in India :

Some suggestions to overcome the shortcomings in the policy for investment by private sector investors in the space sector in India and lack of timelines for IN-SPACe phases –

Determining the time limit : 

  • The Government of India should set a stable time frame for IN-SPACe to ensure its establishment and operationalization, and so that IN-SPACe can obtain authorization from the legislature.

To determine clarity of FDI and licensing rules :

  • The Government of India needs clear rules and regulations regarding FDI and licensing in the envisaged policy framework. Clear rules for government procurement, liability in case of violations and dispute settlement should be set for new space start-ups.

Providing legislative authority to IN-SPACe : 

  • The Government of India should pass a bill for this sector, so that IN-SPACe can get statutory status. The bill should set timelines for ISRO and IN-SPACe and also include directions for foreign investment and government support.

To promote more support and discipline:

  • The Government of India should develop a positive discipline and support system in the space sector, providing government support to new space start-ups. The Government of India should make schemes to promote investment and provide support to new enterprises.

To develop constitutional and prosperity structure :

  • India’s space sector should maintain its prosperity structure for growth, so that space start-ups can get the necessary constitutional, technical and financial support. Through these means, the government and IN-SPACe can develop and take new energetic and successful actions in the space sector.

Conclusion / Path to solution :


  • IN-SPACe is a regulatory body but does not have legislative authority. Therefore, the Government of India should make it a legislative authority by amending the Indian Constitution.
  • The government should keep the regulatory environment of the space sector clear.
  • Space Policy 2023 is a forward-looking document that reflects good intentions and vision. But it is not enough. There is an urgent need to set a timeline to provide the necessary legal framework to turn this vision into reality so that India can be successfully launched into the Second Space Age. The government should bring a bill that provides statutory status to IN-SPACe and also sets a timeline for both ISRO and IN-SPACe. The Bill should also address ambiguities related to foreign investment, government support for new space startups, etc.
  • In this process, the government needs to maintain a clear regulatory environment, reduce red tape, increase public support and facilitate Indian companies’ access to foreign markets. Without this, the full benefits of liberal policies that increase this support cannot be realized. Thus, India’s space sector is moving towards new heights and providing a new opportunity for private companies to play a role in it.
  • The government needs to ensure the regulatory environment allows the space sector to function and meet high quality and safety standards.


Practice Questions for Preliminary Exam :

Q.1. Consider the following statements regarding the Indian Space Policy 2023 in the new era of India’s space sector.

  1. India’s space sector is ushering in a new era in which private sector investors are getting the right to invest 100 percent.
  2. The Remote Sensing Data Policy was introduced in 2001, which was replaced by the National Geospatial Policy in 2016.
  3. The objective of the Indian Space Policy 2023 is to – ‘Enable, encourage and develop a thriving commercial presence in space’.
  4. The Government of India should issue a guideline to ISRO, so that IN-SPACe can get statutory status.

Which of the above statement / statements is/ are  correct?

(A) Only 1 and 3 

(B ) Only 3 and 4 

(C ) Only  2 and 4

(D ) Only  2 and 3

Answer – (D)

Practice Questions for Main Exam :

Q.1. Highlighting the main provisions of ISRO’s role in India’s space sector, discuss how India can become self-reliant and a global leader in the space sector with the participation of private investors under the Indian Space Policy 2023 in the new era of India’s space sector. Can play the role of a major space power? Give a logical explanation. 

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