[Answered] The growing role of the private sector in space, demands India to move quickly towards a new model for India’s space activity. Explain with illustrations.
Red Book
Red Book

Demand of the question Introduction. Contextual introduction. Body. Discuss why the private sector should be involved in the space industry. Also mention issues and Concerns of private participation in the space industry in India. Conclusion. Way forward.

India is among the global leaders in space exploration. ISRO has spearheaded India’s success in space. These include various satellite launch, space-launch vehicles, and a range of associated capabilities. But the private sector has not contributed much to it. India is lagging in harnessing the power of private innovation in the space domain. This not only limits the exploitation of space for economic development, but has serious national security implications.

Why should the private sector be involved in the space industry?

  1. Increasing Demand: Indian Space Research Organisation (ISRO)’s annual budget has crossed ₹10,000 crore ($1.45 billion) and is growing steadily. However, demand for space-based servicesin India is far greater than what ISRO can provide. Therefore, private sector investment is critical, for which a suitable policy environment needs to be created.
  2. Overall growth of space sector: Private sector participation is needed to ensure overall growth of the space sector. ISRO has a strong association with the industry, particularly with Public Sector Undertakings (PSUs) like Hindustan Aeronautics Limited and large private sector entities like Larsen and Toubro. Role of private industries should be increased.
  3. Country’s security: The most basic way to secure our space capabilities is to distribute them across many different satellites and spacecraft, so that continuity is unaffected even if an adversary manages to disable one or more of our satellites. For instance, the US is highly vulnerable in space because it depends on thousands of its satellites. But it is also best equipped to deal with a potential attack on its space assets because it can find alternatives to switch to.
  4. International trends and experience- Elon Musk’s “SpaceX” and its high profile projects have highlighted the increasing significance of the private players in the space sector. In India, despite the various strategic, security and regulatory constraints, a limited private ecosystem has evolved around the ISRO.
  5. Greater pool of resources: Public resources- land, labour, capital are limited. Private sector participation will open a new pool of resources and talent. It will bring more funding, and experience into space exploration activities.
  6. Human Capital: Restricting space activities to ISRO, limits proper utilisation of talent all over the country. With demographic dividend, private sector participation can exploit the talent across the nation contributing a lot to space explorations in India.
  7. Technological advancement:Commercialisation will also develop better technologies which are important. It will allow integration of many other technologies like artificial intelligence into space exploration activities. With experience from space activities, the private sector can increase the role of technology in other areas.
  8. Risk Sharing: Every launch consists of various risks. Private sector helps in sharing the risk of cost factor. Failure costs will be distributed. Also with increased private participation, failures will reduce due to increased available human capital and mind.
  9. Commercial demand:There is a need to enhance internet connectivity for the masses, which is another demand pull factor for increased commercial interest in space. Asteroid mining is also another potential area that looks promising, with scope for monetisation and disrupting commodity markets.

Issues and Concerns of private participation in space industry in India:

  1. Data Risk:Though space it gives an opportunity to entrepreneurs but raw data of ISRO in the hands of the public is sensitive and consists of danger of misuse or improper utilisation of data.
  2. Regulation: Though it is a profitable investment, regulation of private sector participation is not easy. The time taken for regulatory clearances and unstable political institutions can cause delays and hurdle in decision making of investors.
  3. Revenue loss: ISRO will lose a fair amount of money it is earning through its space activities. This will reduce government revenue.
  4. Unfair commercial practices: Allowing private sector may lead to lobbying and unfair means to get space projects or launch of any satellite for their own profit. It may also lead to leakage of sensitive information by private players to other countries and companies to make profit.

India should create an independent body that can create a level playing field for government and private space enterprises. A new Space law for India should be framed which should aim at facilitating growing India’s share of global space economy to 10% within a decade which requires a new kind of partnership between ISRO, the established private sector and the New Space entrepreneurs.


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