Global Space community is eagerly awaiting the upcoming broadband constellations that are likely to redefine the role of space services in digital communications. These new services are expected to drive the digital revolution by bringing in world-wide connectivity and low latency, at an affordable cost. World Space business may be at the cusp of an inflection point, driven by rising demand, lowering of costs and generous funding. Many countries have opened up their space domain for entrepreneurs, so as to garner a fair share of the growing market. However in India, one of the major space faring nations, the scenario is different. Indian Space is a closely regulated domain, mainly catering to the requirements of the state.
Space activities have been traditionally driven by the state. We have seen many global space companies emerge in the west, largely due to the policies followed by those countries in encouraging private industries to design & develop space systems according to the requirements. However, in India, scenario was different. Our space program was a low budget program, which did not allow large scale industrialisation. Also, in the beginning stages, Indian industries were not ready to understand the requirements of high-quality, traceability, process requirements, functional requirements, etc. Due to these reasons a full-scale industrialisation could not be implemented. But, as the program grew in stature and budget, more and more industries participated and learnt the difficult art of space manufacturing! However, their involvement remained as a service provider, addressing only a part of the system.
With the maturing of technology and increase in demand, Space industry has grown well and today it is a $360 Billion industry. Last decade saw the emergence of New Space, with numerous start-up companies bringing in many new ideas and a new meaning to Space business. In India, the idea of a private space player was something which was considered highly improbable some time ago. Existing industrial partners of ISRO were deterred by the demands of quality, low volume coupled with high variety and large CAPEX requirements. However, as the viability of Space business became clearer, some New Space actors emerged with the help of angel investors. However, the number of start-ups is small when you consider the huge potential for space business in India, owing to the uncertainties in the regulatory framework and consequently investments.
Regulatory framework is probably the biggest hurdle for the growth of New Space in India. Hopefully, the new ‘Space Activities Bill’, scheduled for enaction in the near future, will bring the much-needed clarity to Indian Space. It needs to be clear to the aspiring companies, what can be done and how. It is reasonable to expect that VCs will become more active with a ‘Space Act’ that is business friendly and enabling in nature. The regulatory agency also needs to be re-defined as more and more private players emerge. Today Department of Space carries out the additional task of regulation. But since they are a major service provider also, this may lead to conflict of interests. It may be worthwhile to recollect that DoT was also a regulator and a service provider (through its PSU arms BSNL, MTNL& VSNL), till the introduction of National Telecommunications Policy in 1994. This led to the formation of a formal regulator – TRAI (Telecom Regulatory Authority of India) in 1997. Such an overhaul of existing regulatory framework will go a long way in spurring the growth of space commerce in India.
Though India is a major Space faring nation, there are very few industries who possess the technology to design, manufacture, qualify& supply space sub-systems like various types of sensors, inertial systems, control mechanisms, propellant storage & delivery systems, thrusters, power systems, payloads, etc. This is another hurdle that the industries face. This can be overcome with a suitable ToT policy by ISRO identifying technologies/products of commercial interest. Such a policy, with buy back arrangement, will ensure that the industry is qualified to compete in the global market. The achievements of Indian Space programcan be translated into commercial benefits for the country through such a move. Antrix Corporation had initiated this ToT process, for small satellite technology, with this objective in mind.
India has a booming start-up eco-system. Though Space is a difficult arena, it is indeed heartening to see start-up companies foraying into the Space domain also. One common problem that start-ups face is that of financial support. Currently, there is no government funding scheme exclusively addressed to the Space start-ups. This is another area that needs immediate attention for accelerating the growth of commercial companies and ensure a fair share of the global market in the future.
As far as the Indian Space market scenario is concerned, recent market studies conducted by Antrix Corporation have indicated that the demands for satellite based services are on the increase. This demand is arising out of the need to have dedicated capacity for communication as well as EO. Also, large corporate are willing to invest in their own satellite, thereby ensuring captive capacity for their future needs. Growth in EO technology, like high-res SAR and SAR-Optical constellations, have made many mining companies looking at replacing their field equipment based technology with EO satellite based applications for monitoring as well as assessing the volume of minerals mined. New applications like IFMC, 5G, IOT and Government initiatives like Digital India and BHARATNET offer great opportunities for companies to foray into the Indian Satcom market.
India has got all the essential ingredients to become a major player in the commercial space market. However, we need to develop the eco-system by introducing the right policies and incentives. With the emergence of New Space in India, companies are looking forward to the Government for de-regulation and opening up of the sector. Days are not far for India to emerges as the New Space hub of the world.
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The problem with buyback arrangement is that every failure will be borne by the government.
No major industry wants to participate knowing fully well the low demand and high risks.
Most start-ups in India today, want ISRO to do the R&D and handover the technology for production.
The space industry has enormous profits for the startups. They should be willing to share the losses just as the profits.
India especially the government should shed the fear of space applications which are mainly generated by false sense of security.
Accepting science and technology especially AI is the way ahead.
Hoping to see better amalgamation of government and private industry with new space policies and space bill.
Its quite an understanding of the author has structured his opinion and how the path should be shaped up in coming future for the Indian Space-Tech startup ecosystem. Here is what I think, space is a like the road to infinity and there is no stopping to one’s exploration. Having said this, I firmly believe that there will be a turning point when ISRO will reach to its maturity stage, and from there it would only focus on extraterrestrial research as said, (https://yourstory.com/2019/05/isro-venus-moon-mars-interplanetary) this would clearly mean that ISRO will shift its focus from sending or manufacturing small or large satellites or even launching it into space.
To keep that on the track, ISRO would need to focus and list startups in India that would do the job for them. and that’s where ISRO should and must promote and focus on this area. On the same note, it would be in the governments’ interest to not let the image of the country down, following which there could be a push to change the education from theoretical oriented to practical oriented.
These two points would not only help shape the future of India’s space market or ecosystem but will boost the overall development of India. I believe its a two-way road, one way is the startups, the other is the government agencies.
Talking about investments, I think it’s still for the government to provide a certain amount of funding, as far as concerned.
https://www.geospatialworld.net/article/newspace-india-opportunities-challenges/
https://www.geospatialworld.net/blogs/space-activities-bill-good/
Some of my observations and views made in 2017 on the Space Act and 2018 on the rising NewSpace India phenomenon. Might be relevant to the points brought out by Rakesh Sasibhushan.
Great and timely op-ed.
I don’t think capital is as big as a problem to space start-ups as being able to get access to markets/projects is. Government financing normally comes with more red tape and is a bigger hurdle. There are several VCs ready to finance space startups but they need to see that there is an upside without government competing with the start-ups. I would suggest that the focus of the policymakers instead be focussed around innovating how they help in the lifecycle of start-ups. One example could be creating Announcement of Opportunity for start-ups to fly experimental payloads of products they are building on some ISRO missions (either on small satellites by ISRO itself). This can help fast track time to the market instead of sourcing money from the government directly.
For eg, if a startup wants to provide a space-based EO service today, no one knows how they will be authorised to launch, how the frequencies for commercial EO operator will be allocated through DoT (auction, lease, first-come?). Many of these aspects of realising space startups actually need inter-departmental/ministerial coordination. The most important need for space start-ups is an inter-departmental/ministerial coordination body that can help smoothen the overall operational landscape for space start-ups. None of these operational aspects is currently taken into account in the space law draft. The space law draft should have ideally mentioned that an inter-departmental/ministerial coordination body will be set up guidelines/rules for operational aspects.
ISRO is also sitting on top of some resources that can be made open such as data archives from its EO satellites. This model has been followed in Europe with the Copernicus Program which has enabled the creation of 100s of startups which have built services on top of this data. There needs to be a lot of innovative thinking on how current ISRO assets can be leveraged to help build/support a start-up ecosystem.
The efforts by the government to finally open up space is commendable. Interest from angel investors and VCs in the private space market shows confidence in the Indian tech sector. However, the critical factor that would make or break a space organisation especially companies that design, build and operate launch vehicles and satellites is and always has been Expertise.
Expertise is the biggest differentiator in the launch vehicle market. Historically, expertise from the Nazis helped accelerate the space efforts of US and Russia. Countries like India, China, Japan etc have all relied on foreign expertise in their earlier days. So if India truly wants to get serious with private space companies, it should be willing to lend expertise. The sheer volume of publications (Design criteria, Reliability practices, Monographs etc) by NASA and other US agencies shows how much they are willing to share. Another way to help create expertise is through offering internships. Currently, ISRO hardly offers any short term internships(1-2 months) to BTech students which is unfortunate because that’s a critical period. In contrast, literally hundreds of thousands of students intern at NASA, private space companies and Universities/Labs working on space. The experience would of course benefit both parties. That’s something we could learn from. Thirdly, it is a well known fact that private investment alone would not help build end-to-end space companies. Companies like SpaceX, Boeing, Lockheed Martin, Northrop, Blue Origin, Orbital Sciences-the list goes on have all benefitted from government contracts. Since the New Space companies are still in their infancy, it would be advisable to award contracts that have a shorter life cycle (Eg study contracts, design contracts, developmental contracts etc). These three factors heavily determine the long term success of private space companies.