India working on public-private partnerships to fully tap into space sector’s commercial potential: ISRO Chief

The head of the world’s sixth-largest space agency has said that they are working on developing public-private partnerships to not only maximise the Indian space sector’s business potential but also spur its growth.

“The business opportunity of space is going to be worked out in the Public-Private Partnership (PPP) model. We are in discussions with various consultants to generate models best suited to our space sector. Only then can we increase the economy of space activity in this country from the current $7 billion to say something like $50 billion, which will be a significant part of the global space economy,” S. Somanath, Chairperson of Indian Space Research Organisation (ISRO) and Secretary of the Department of Space (DoS), said Wednesday.

Somanath indicated this would result in a complete break from the past where government spending was the only source of funding for the country’s space sector. The earlier approach involved ISRO receiving government funding, working on designs and then contracting or subcontracting them to private players for execution. In this regard, DoS was especially examining new ways of bringing in fresh investments into the sector through both the FDI route as well as enhanced private sector participation.

For FY23, ISRO has been allocated nearly $1.6 billion under the Union Budget.

“For example, in the communications domain can companies build satellites and launch them on their own? This was not possible till last year but is now possible. We are going to give the companies the license to build satellites, and that can be done outside of ISRO,” said Somanath.

He said that work on the long-awaited FDI policy for the space sector was at an advanced stage. Together with the single window nodal agency for authorising, promoting and regulating private players in the space sector IN-SPACe, the recently announced Indian Space Policy, 2023, and PPP frameworks being worked upon, the policy would help in developing a new business model for the sector.

As a leading spacefaring nation, India opened up its space sector to private sector participation in 2020.

Private sector needs to do more R&D

Somanath also observed that while companies like Godrej Aerospace, Larsen & Toubro and Walchandnagar Industries were involved in the manufacturing of critical components such as rocket engines, the R&D part was only being handled by ISRO. But a change in mindset was needed there as well.

“Currently, the industry is not capable of doing basic research on material sciences, manufacturing technology, calibration, fluid flow, etc., to a level they can design the components themselves. It is our desire that the industry does that in the future.”

Since its inception in 1969, ISRO has created a vibrant ecosystem of over 400 companies to service its varied requirements.

Saying the geopolitical uncertainty had provided ISRO the opportunity to undertake missions such as the launch of 32 telecoms tycoon-backed Sunil Bharti-backed OneWeb satellites, Somanath said they looked forward to more such assignments.

“OneWeb itself was surprised to see how a new rocket could perform such a complex mission in the first attempt. And they said they were happy to launch with us a second time as well. Now they want to launch the future generation of their satellites through us.”

Somanath was speaking at the 50th National Convention of the federation of the country’s largest management association, the All India Management Association (AIMA), in New Delhi, Wednesday. On his arrival, the national space agency chief was welcomed like a national hero, with the over 700-strong audience spontaneously rising to accord him a standing ovation. His session, on India’s space odyssey, was watched by over 7,500 people on AIMA’s YouTube channel, an association official later disclosed to Business Today.