Government recently relaxed rules to allow 100% foreign direct investment (FDI) in space sector.
More about News
- Existing FDI policy in Space sector: Earlier, FDI was permitted in the establishment and operation of Satellites through the Government approval route only.
- Amended FDI policy:
- 100% FDI is allowed in space sector in line with the vision and strategy under the Indian Space Policy 2023.
- The liberalized entry routes are aimed to attract potential investors to invest in Indian companies in space.
Foreign Direct Investment (FDI) limits for different segments of the satellite sub-sector in India It’s divided into three categories based on the percentage of FDI allowed under the automatic route:
- Up to 100% FDI under Automatic route:
- Manufacturing of components and systems/sub-systems for satellites, ground segment, and user segment.
- Up to 74% FDI under Automatic route:
- Satellites-Manufacturing and Operation, Satellite Data Products and Ground Segment & User Segment.
- Beyond 74%, these activities fall under the government route.
- Up to 49% FDI under Automatic route:
- Launch Vehicles and associated systems or subsystems, Creation of Spaceports for launching and receiving Spacecraft.
- Beyond 49%, these activities fall under the government route.
Steps taken by India to support private sector in space
- Indian Space Association (ISpA): Launched in 2021, it is the apex, non-profit industry body exclusively working towards successful exploration, collaboration, and development of private and public Space Industry in India.
- Antrix Corporation Limited: Incorporated as a marketing arm of ISRO. It handles ISRO’s commercial deals for satellites and launch vehicles with foreign customers.
- The Indian National Space Promotion and Authorization Centre (IN-SPACe): An autonomous nodal agency to facilitate private sector engagement in space activities.
- To encourage private investment, the government has also exempted private launch service companies from paying GST when they launch satellites.
- India space policy 2023 suggests that the private sector is a critical stakeholder in the entire value chain of the space economy.
