Private Players in Space Sector | 20 May 2022

Why in News?

Recently, the Minister of State for the Department of Space (DOS) informed the Lok Sabha that the government was looking at opening the space sector to Foreign Direct Investment.

How this Step will be Beneficial for ISRO?

• Research and Development Activities:
  • These reforms will allow ISRO to focus more on new technologies, exploration missions and human spaceflight programme.
    • Some of the planetary exploration missions will also be opened up to the private sector through an ‘announcement of opportunity’ mechanism.
• Fruitful Dissemination of Space Technologies:
  • Allowing industries and others like students, researchers or academic bodies greater access to space assets would lead to a much better utilisation of India space resources.
• Global Technology Powerhouse:
  • It will enable Indian Industry to be an important player in the global space economy.
    • With this, there is an opportunity for large-scale employment in the technology sector and India becoming a Global technology powerhouse.
• Cost-effective:
  • The operating costs of setting up base and launching space vehicles in India is comparatively much less compared to its counterparts like National Aeronautics and Space Administration (NASA).
  • The FDI will also ensure that the newer technology makes it more effective in price as well as efficiency.
• Exceptional Success Rate:
  • ISRO is the 6^th largest space agency in the world and holds an exceptional success rate.
    • India has made a name for itself by successful launch of about 342 (three hundred and forty-two) foreign satellites from over 34 (thirty-four) countries.

What are the Benefits for Foreign Investors?

• Innovative Equipment:
  • ISRO holds the cutting-edge equipment and is also in process of launching SSLV (small satellite launch vehicle) in partnership with private companies.
  • This will provide a greater benefit to foreign investors to form partnerships with the Indian space sector.
• Liberalised Space Sector:
  • Over the years, ISRO has forged strong relationships with numerous industrial ventures that will be beneficial to foreign players who wish to set up base in India.

What is the Need for Reforms of Space Sector?

• To increase the Scale of the Sector:
  • ISRO is centrally funded and its annual budget is between Rs 14-15,000 crore, which is a drop in the ocean and most of this is used in building rockets and satellites.
  • To increase the scale of the sector, it is imperative for private players to enter the market.
  • ISRO is planning to share knowledge and technology, such as manufacturing rockets and satellites, to all the private players.
    • The United States, Europe, Russia — all have space industries with big players like Boeing, SpaceX, Air Bus, Virgin Galactic, etc.
• Reforms in Private Players:
  • Private players can bring in the innovation needed for developing space-based applications and services.
  • Additionally, the demand for these services is soaring worldwide and in India, with satellite data, imageries and space technology being used across most sectors.
    • The Private players can participate in setting up of ground stations for space crafts which constitute 48% of the space sector budget and also in application of space technology which result in 45% of space economy.

What are the Related Initiatives taken?

• IN-SPACE:
  • IN-SPACe was launched to provide a level playing field for private companies to use Indian space infrastructure.
  • It acts as a single-point interface between Indian Space Research Organisation (ISRO), and everyone who wants to participate in space-related activities or use India’s space resources.
• NewSpace India Limited (NSIL):
  • Announced in Budget 2019, its aim is to use research and development carried out by ISRO over the years for commercial purposes through Indian industry partners.
• Indian Space Association (ISpA):
  • ISpA aspires to be the collective voice of the Indian Space industry. ISpA will be represented by leading domestic and global corporations that have advanced capabilities in space and satellite technologies.

Way Forward

• With India having one of the best space programs in the world, the move to allow FDI in space will make India a bigger player in the global space economy.
• FDI in space will allow foreign players with a window to venture into the India space domain, this will contribute to Indian national and foreign reserves, promote technology transfer and research innovations.
• Further, the introduction of the Indian Space Activities Bill will give greater clarity to private players on how to be an integral part of the space sector.

Source: IE