Restrictions on foreign investment in the Indian space sector have been lifted
India has updated regulations in the space sector to attract global investors and companies after opening it up to private companies four years ago. The new foreign direct investment policy increases restrictions on foreign investment, which should stimulate renewed interest in the South Asian space community.
Private and public actors in India are taking steps to increase participation in the country's space sector. Indian space agency ISRO has made significant strides in gaining global attention over the past few months, including the successful landing of its spacecraft Chandrayaan-3 on the Moon. and partnership with NASA to join the «Artemis Agreements». However, foreign direct investment regulations have limited the country's ability to attract international investors and delayed funding for some of India's growing space technology startups.
On February 21, the Indian Cabinet, led by Prime Minister Narendra Modi, approved an amendment to foreign direct investment norms to increase foreign investment in the space sector, in some cases up to 100%. The Government of India has defined three different categories under the amended policy. Up to 49% (foreign ownership) for launch vehicles and related systems and subsystems, creation of cosmodromes for launching and receiving spacecraft. Up to 74% for the production and operation of satellites, satellite data transmission products, as well as terrestrial and user segments. Up to 100% for the production of components and systems and subsystems for satellites, ground segment and user segment. Foreign investments exceeding specified thresholds require government approval.
In June 2020, the Indian government carried out reforms in the space sector and established a new agency — Indian National Center for Space Promotion and Authorization to allow private companies to use ISRO's resources and infrastructure.
Last year, the country also unveiled its space policy, which details guidelines and rules for participation. New Delhi also replaced its century-old rules with a new telecom law to create a framework for global satellite broadband service providers, including Elon Musk's Starlink.
India has around 190 space technology startups offering solutions such as launch vehicles, satellite data and hyperspectral imaging. Investment in Indian space startups reached more than $124,000,000 last year, according to government data. The country's space economy is projected to reach $44 billion by 2033, up from $8.4 billion last year.
Industry body the Indian Space Association, which includes space technology startups and private companies, expects the updated norms to help expand India's presence in the global space economy from its current share of just over 2%.< /p>