Budget 2024 sets up Rs 1,000 cr venture capital fund for space economy

Industry welcomes proposal to expand space economy five-fold in 10 years through private sector participation

The government will set up a Rs 1,000 crore venture capital fund to promote space technology, said Finance Minister Nirmala Sitharaman in her Budget speech on Tuesday, seeking to expand the country’s space economy five-fold in 10 years through private sector participation.

The size of India’s space economy is around $8 billion now and the government is targeting to take it to $44 billion by 2033.

Reforms in 2020 have increased private participation in the sector. The Indian National Space Promotion and Authorisation Centre (IN-SPACe), a single-window agency to promote and authorise investments, was set up in June 2022. IN-SPACe’s efforts have helped around 300 startups, which include authorisation, handholding, facility support and consultancy, technology transfer, and facility usage.

“The Rs 1,000 crore venture capital fund is a huge booster for India's ascending space startup ecosystem. This unprecedented level of support demonstrates the importance the Indian government is placing on developing private space programs and capabilities,” said Pawan Kumar Chandana, co-founder and chief executive officer (CEO) of private space technology company Skyroot Aerospace.

Skyroot, one of the most funded startups in the Indian space sector, in November 2022 successfully developed and operated launch vehicle Vikram-1, becoming the first private player to do so.

"This will help larger players emerge out of India’s space startup ecosystem. This also shows that the Government is continuing to strongly back its vision of making India have a larger chunk of the global space economy," said Srinath Ravichandran, co-founder and CEO of Agnikul Cosmos.

Privately owned PixxelSpace, Digantara, Dhruva Space, Azista BST Aerospace and Tata Advanced Systems have developed satellites and functional payloads for operations in outer space. The first private launchpad and mission control centre was established by Chennai-based Agnikul Cosmos in November 2022. A consortium of state-owned Hindustan Aeronautics Ltd and L&T consortia has been selected to build five Polar Satellite Launch Vehicles.

India has 55 active space assets which include 18 communication satellites, nine navigation satellites, five scientific satellites, three meteorological satellites, and 20 Earth observation satellites.