Budget 2024 Forecast: Boosting India's Space Sector with Innovation and Growth

The Space Activities Bill introduced by the government outlines the legalities for private sector participation in space-related ventures. A huge support for startups, this bill aims to offer clear guidelines and reduce bureaucratic red--tape.

Girish Linganna

First Published Jul 18, 2024, 5:03 PM IST | Last Updated Jul 18, 2024, 5:03 PM IST

The Indian government has been actively supporting the space sector, recognizing its potential to drive economic growth and technological advancement. Several key initiatives have been implemented to foster innovation and expand the role of the private sector in space activities.

Key Initiatives

One significant move is the establishment of the Indian National Space Promotion and Authorization Center (IN-SPACe). This organization encourages private sector involvement in space activities by acting as a bridge between the Indian Space Research Organisation (ISRO) and private companies. IN-SPACe ensures smooth cooperation and provides a supportive regulatory framework.

Growth Targets

India's growing space economy, valued at about $8 billion as of last December according to the Department of Space, is seeking more budget support. This funding would help create local demand and build capacity, allowing the private sector to play a bigger role. By doing this, India plans to increase its share in the world space market to 8%. Industry experts believe this support is crucial for India’s space industry to grow more than five times its current size over the next eight years, aiming for a projected value of $44 billion by 2033.

What's Coming

Industry experts expect the forthcoming Union Budget, 2024, to bring in important incentives for raising domestic demand. These could involve funding new startups and encouraging government agencies to become customers of the space industry, according to a senior government official familiar with the plan.

Private Sector

Experienced industry professionals emphasise the need to expand the private space sector. They hope to see such schemes as production-linked incentives (PLI) for key components, reduced GST rates, tax breaks for space startups, lower import duties on essential parts and affordable loans to support space projects.

Startup Funds

Besides providing grants, the government plans to create dedicated funds to support space tech startups. Managed by specialized agencies, these funds will offer seed funding, venture capital and other forms of financial assistance. The aim is to build a strong ecosystem where startups can access the resources they need to grow and bring their innovations to market.

Introducing PPP

An important aspect is the introduction of public-private partnership in space-related projects. The government plans to involve the private sector in publicly funded space missions to utilize private companies’ resources and expertise. This will not only hasten innovation, but also reduce the government’s financial burden.

Fostering Innovation:

Innovation is central to the expected funding for startups in India’s space sector. The government understands that technological progress is vital for the country to stay competitive in the global space industry. To encourage innovation, several initiatives have been implemented.

First, the government is promoting partnerships between startups and research institutions. By facilitating these collaborations, it aims to encourage knowledge sharing and leverage the expertise of researchers. This will allow startups to access advanced technology and benefit from the research capabilities of academic institutions.

Second, the government is putting money into the development of space innovation hubs and technology parks. These specialized areas will offer startups the infrastructure, resources and support they need to develop and test their innovations. By fostering a supportive environment for research and development, the government aims to speed up technological progress in the space sector.

Conclusion:

The Indian government's proactive approach in supporting the space sector through strategic initiatives and financial incentives aims to create a robust ecosystem for growth and innovation. With these efforts forecast for Budget 2024, India is well-positioned to expand its space industry and increase its presence in the global space market.

(The author of this article is a Defence, Aerospace & Political Analyst based in Bengaluru. He is also Director of ADD Engineering Components, India, Pvt. Ltd, a subsidiary of ADD Engineering GmbH, Germany. You can reach him at: girishlinganna@gmail.com)

For more reliable and latest news