Dusting Off The Cosmic Blueprint: India's Space Success at the Crossroads

Shubanshu Shukla, an Indian astronaut, travelled to the International Space Station in 2025. This is a significant moment that goes beyond simple patriotism. India’s missions like Mangalayaan and Chandrayaan are praised for their low cost and efficiency all over the world. Nevertheless, despite this achievement, India continues to be marginalised in the global space economy, which is expected to reach a value of $1 trillion this decade.

Illustration by The Geostrata

This article will explore that gap by looking at how India’s space sector, though technologically strong, remained economically underutilised in space. Most importantly, it will offer practical steps to help India move from being a successful spacefaring nation to becoming an economic architect- through better policies, private sector participation and global partnerships. 

WHY DOES INDIA LAG IN THE GLOBAL SPACE ECONOMY OF THE WORLD?

India’s space economy is currently valued at $8.4 billion, accounting for 2% of the global space economy. India aims to increase its market share to 78% by 2033, trying to achieve the target of a $44 billion space economy.  China’s space economy, challenging the US, is projected to be more than $900 billion by 2029, capturing 20% global market share.

In comparison, the US space economy is valued at $142.5 billion in 2023, accounting for 2% of the world's market share. There are various reasons and challenges behind India’s not being able to achieve a significant share in the market economy.

First, the sector’s focus has historically been public-sector driven, with its goals rooted in scientific research, defence, and solving developmental challenges. Due to this, the country has used space as a tool for solving development challenges. There are more than 500 private suppliers, including L&T, which has supported ISRO for nearly five decades in areas such as PSLV and GSLV integration; Godrej Aerospace, which produces rocket engines and spacecraft thrusters; and ASACO, the sole manufacturer of PSLV stage four engine (PS4), among others.

But the core science, strategy and major missions remain publicly led. Since its early years, ISRO has focused on satellites for tele-communication, weather forecasting, agricultural monitoring, and education.

For example, INSAT satellites were used to bring TV and radio services to remote villages, while EDUSAT, launched in 2004, was used for distance learning. 

These missions provided direct social return, and the government prioritised them to improve rural connectivity, disaster response, and education access. Economic expansion in the space sector requires private participation. 

Until 2020, ISRO exclusively controlled launches, satellite manufacturing, and data-related services. Private companies had no legal clarity or authority to engage in building or launching satellites. The Space Activities Bill, aimed at clarifying responsibilities and liabilities in space, has been pending on name of review since 2017, delaying broader commercialisation. Only in recent years, platforms like IN-SPACe and NSIL begun paving the path for private sector engagement. 

Secondly, funding continues to be limited. Funding is the backbone of India’s space program, but funding largely comes from public investment, where ISRO’s budget- allocated through public funds- covers everything from satellite designing, planning, manufacturing, to launch infrastructure.

The annual budget of ISRO in 2024-25 was $1.55-1.95 billion, which is even less than a single private US company, “SpaceX”, and far lower than NASA, which allocated $25-27 billion in 2025. While this has allowed good outcomes at low cost, it has left the sector highly under state control.

Private investment in space remains low. Venture capital firms and private investors in India avoid investing in space because of its uncertainty due to low assurance of returns and long development cycles. Without strong financial initiatives or government-supported funding schemes, private players are afraid to enter or grow in the space domain.

HOW DOES THE MARKET-DRIVEN SPACE ECONOMY LOOK? AND WHAT ARE THE STRATEGIES TO TRANSFORM IT?

This transformation could bring major benefits: expanding India’s space economy from its current $9 billion to a projected $44 billion by 2033, which means capturing 8% of the global shares. This could create better employment opportunities for the skilled workforce of the country in domains like manufacturing, data analytics, etc. It could allow the country to achieve self-sufficiency and attract foreign investment. It can lead to an increase in startups, more innovation and opening doors for global partnerships, technology transfers, and export opportunities.

Strategically, India becomes more self-sufficient and less dependent on foreign systems for navigation, surveillance and data. Space is now considered a new high ground in geopolitics because countries with strong space capabilities can monitor borders, guide military operations, and protect their assets in orbit. A market-driven economy can also boost India’s geopolitical capabilities by exporting services to other countries, especially in Asia, Africa, and Latin America etc.

The South Asia Satellite is a good example of space diplomacy by providing communication services to neighbouring countries. This builds India’s soft power and strengthens India’s role as a responsible regional partner for South Asian countries and a global space leader. 

Technological Independence is very crucial for any country to protect their strategic autonomy, and it can only be achieved by reducing its dependence on foreign suppliers. India must finalise and implement the  Space Activities Bill, which has been pending since 2017. This bill would define the clear rules for licensing, authorisation, and supervision of space activities. This gives startups and private firms confidence to operate without fear of legal ambiguity or sudden policy shifts.

It would open the space opportunities to non-government entities by legalising their role to build, launch and operate satellites and space systems under government oversight. The space activities bill will ensure that all space activities- especially by private players comply with these globally recognised obligations, protecting India’s reputation and legal standing.

HOW CAN PRIVATE FIRMS INNOVATE TO CONTRIBUTE MEANINGFULLY?

The government is recognising the growing need for private firms in the space sector to expand the country's space technology exports by leveraging policy reforms and providing institutional support. The establishment of IN-SPACe as a single window enabling regulatory and facilitating aspects for private firms to participate fully in easing market entry and export operations. Other policies, like 100% FDI under the automatic route for satellite components and systems, attract foreign collaborations.

ISRO now shares facilities and transfers technology with private organisations, which is enabling them to directly collect, compile, and test entire satellites and launch vehicles. It will improve the manufacturing pipeline and will reduce downtime between launches.

If startups were to start taking on commercial launch contracts and operational risk, it would spread costs and incentives across both public and private players. Thus, encourage greater launch volumes without overwhelming government budgets.

Startups like Skyroot, Agnikul, Pixxel, and Dhruva Space are some examples. They are developing launch vehicles, satellite platforms, and advanced remote sensing applications. Indian space exporters are targeting $11 billion in exports by 2033, further driving business towards India.

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BY RITIKA SWAMI

TEAM GEOSTRATA

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