16th May 2020 was a historic day for all those who were looking at the Indian space domain as the new frontier for business. Finance Minister Smt Nirmala Sitharaman’s announcement of space sector reforms gave a boost to investors, start-ups and corporates which were looking to venture into this promising new domain. Space was a restricted domain for a long time and only ISRO was allowed to deal with it. This was understandable, considering the dual-use of technologies involved, the possible misuse of data and the concern for security. However, the development models in the sector around the world provided adequate confidence in tackling these issues, and the advantages that a free environment provides, both to technology development and to commerce, far outweighed the negatives, thus enabling the reforms.
The renowned domain consultants – ‘Euroconsult’ have valued the global Space economy at US$ 385 billion in 2020 and it is expected to grow to US$ 428 billion by This growth is enabled by growing demand for space-based services, lowering of costs, miniaturisation and access to technology, liberal funding and enabling regulations around the world. India too holds great promise as a destination for increased space commerce and also as a manufacturing hub. Years of close regulation and control had suppressed market demand and the proliferation of true benefits of space technology to the masses. India holds significant latent demand for space-based services, waiting to be exploited. However, cost of delivery and quality of service will be the deciding parameters for success.
Today, the global space commerce is dominated by the West, with India’s share being less than 3%. This is due to the lack of an enabling space ecosystem in India and the constraints of ISRO, the lone player from India. During my career as CMD of Antrix Corporation, I have come across demand from many developing countries, which could not be tapped due to capacity constraints. South East Asia and Africa are potential destinations for home-grown space tech. A space system, leveraging the quality and cost-effectiveness of Indian manufacturing, has great potential to tap into the world market also. Being one among the major space faring nations, India offers significant space pedigree, availability of technology as well as skills, for exploiting the market.
The four major promises of the Government of India 1) level playing field for private companies, 2) predictable policy and regulatory environment, 3) opening of ISRO facilities for the private sector and 4) liberal geo-spatial data policy, are the four pillars on which the Indian space industry will be built. CII National Committee on Space is proud to note that the above is in line with the recommendations of the committee to NITI Aayog and DoS, prior to the announcement.
Subsequently, Department of Space and ISRO have been proactive in interaction with start-ups and industries and have come out with draft policies to implement the reforms. The independent regulatory body, IN-SPACe, however, is waiting to be formally created. This regulatory body holds great importance in the scheme of things and has the principal task of driving reforms forward.
Geospatial data is a great resource for developing applications for solving operational issues, and a country like India needs a tech-savvy and robust ecosystem to cater to its needs. This is an ideal domain for start-ups since the CAPEX requirement is low, and being similar to the IT sector in its set-up, youngsters can take to it readily. The guidelines announced by DST for Geospatial data have been in line with the Government’s reform announcement and removed the restrictions for access and utilisation of data by Indian companies. This will be a great fillip to aspiring companies, and will pave the way for the development of a vibrant ecosystem. India needs these companies to develop solutions for effective management of natural resources, infrastructure building and to improve operational efficiency and revenues in many departments/autonomous bodies. Large PSUs and corporates also need these services to improve their operations and reduce costs.
The space economy of India looks poised to grow to great heights, given the proactive actions and intent of the Government to free commerce from the nuances of regulation. However, policies are yet to be firmed up. The draft Satcom policy-2020, though promising, is silent on free access to services and emerging technologies. Though the policy means well with respect to the creation of Indian capacity, the reality is different. Today, about 40% of Satcom capacity is leased from foreign satellite operators. Since there are no Satellite operators in India outside ISRO, the draft policy tends to bind the customers seeking services from foreign operators again to the old regulatory framework. The emerging technology of service through LEO-MEO (NGSO) constellations is also missing.
The requirement of an Indian entity for services over India also makes it difficult for companies looking to bring these global services to the Indian consumer. Since this is a cutting-edge technology offering many advantages over GEO and being global in nature, unless clear-cut provisions are built in, the Indian consumer is going to miss out on these services. Mandating the requirement to bring orbital resources under Indian administration also is a hindrance to bring Satcom capacity into commercial domain.
CII National Committee on Space has already given comprehensive feedback on all such points to enable a free and liberal policy. Creation of IN-SPACe assumes great significance in this regard and its rollout must be done to maintain its independence and character. The roles and responsibilities of IN-SPACe also do not clearly define its role in the above-mentioned aspects. The promise of space reforms requires closer scrutiny and managerial control for successful implementation.
Let’s hope that the issues will be ironed out in a business-friendly manner and space commerce will be given the much-needed freedom it requires for growing into a significant contributor to the national GDP.
The article by Mr Rakesh Sasibhushan, Chairman, CII National Committee on Space and CMD, Antrix Corporation Ltd, first appeared in the March 2021 issue of CII Policy Watch. Click here to read the complete issue.