Since 2020, India has seen significant growth in the number of space sector startups. It is a direct result of the Indian Government introducing reforms that permitted private firms to carry out all space activities, including the building and launching of privately-developed rockets and satellites, providing space-based services etc.

Today, India has nearly 200 space sector startups, all of whom are operating in a capital-intensive, high-risk, low-return domain, which is dominated by India's Government-run Indian Space Research Organization(ISRO). In order to support such nascent firms, the Indian Union Budget has allocated Rs.1000cr(approx $120mn) as a Venture Capital Fund for space startups. Finance Minister Nirmala Sitaraman announced that the Indian government will set up a Rs.1,000 crore venture capital fund to finance the space economy.

Welcoming the announcement, Lt. Gen. AK Bhatt (Retd.), Director General, of the industry body Indian Space Association (ISpA) said, "The proposal for establishment of 12 industrial parks across India we hope will include the space sector, as this will provide a substantial boost to the space and satellite manufacturing industry, which has long called for the creation of space parks. These measures are pivotal for the growth and development of India's space ecosystem."

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The Indian Government's decision to infuse Venture capital into the space sector is based on a vision to bring about five-fold growth in the Indian Space sector. In recent years, the Indian space economy has been pegged at $ 9 billion, and this is barely two per cent of the $ 450 billion global space economy. With more startups and commercial activity by larger conglomerates, ISRO's commercial arm, the Indian Government sees significant potential in the sector. Having a diverse set of offerings from the government and private sector can enable Indian entities to tap into foreign markets.&nbsp;

The SatCom Industry Association of India opined that the government needed to offer tax incentives, provide regulatory clarity and offer contracts to startups. "By enabling space sector manufacturing through Production Linked Incentives (PLI), addressing pending defence offset obligations, and streamlining procurement processes, we can ensure sustained demand and funding for our burgeoning space economy", said Anil Prakash, DG, SIA-India.&nbsp;

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To further liberalize the space sector, in February 2024, the Indian Government permitted Foreign Direct Investment(FDI) in this strategic domain. This is a bold move that would help infuse foreign capital into Indian space ventures. "We also anticipate the continued streamlining of Foreign Direct Investment (FDI), a critical policy lever for the private Space sector, poised to significantly enhance capital accessibility and drive ecosystem growth forward," said Chaitanya Dora, CFO &amp; Co-Founder of Dhruva Space.

Since 2020, India has seen significant growth in the number of space sector startups. It is a direct result of the Indian Government introducing reforms that permitted private firms to carry out all space activities, including the building and launching of privately-developed rockets and satellites, providing space-based services etc.

Since 2020, India has seen significant growth in the number of space sector startups. It is a direct result of the Indian Government introducing reforms that permitted private firms to carry out all space activities, including the building and launching of privately-developed rockets and satellites, providing space-based services etc. Today, India has nearly 200 space sector startups, all of whom are operating in a capital-intensive, high-risk, low-return domain, which is dominated by India's Government-run Indian Space Research Organization(ISRO). In order to support such nascent firms, the Indian Union Budget has allocated Rs.1000cr(approx $120mn) as a Venture Capital Fund for space startups. Finance Minister Nirmala Sitaraman announced that the Indian government will set up a Rs.1,000 crore venture capital fund to finance the space economy. Welcoming the announcement, Lt. Gen. AK Bhatt (Retd.), Director General, of the industry body Indian Space Association (ISpA) said, "The proposal for establishment of 12 industrial parks across India we hope will include the space sector, as this will provide a substantial boost to the space and satellite manufacturing industry, which has long called for the creation of space parks. These measures are pivotal for the growth and development of India's space ecosystem." Also read: Exclusive: ISRO to test air-breathing hypersonic tech on July 22 The Indian Government's decision to infuse Venture capital into the space sector is based on a vision to bring about five-fold growth in the Indian Space sector. In recent years, the Indian space economy has been pegged at $ 9 billion, and this is barely two per cent of the $ 450 billion global space economy. With more startups and commercial activity by larger conglomerates, ISRO's commercial arm, the Indian Government sees significant potential in the sector. Having a diverse set of offerings from the government and private sector can enable Indian entities to tap into foreign markets. The SatCom Industry Association of India opined that the government needed to offer tax incentives, provide regulatory clarity and offer contracts to startups. "By enabling space sector manufacturing through Production Linked Incentives (PLI), addressing pending defence offset obligations, and streamlining procurement processes, we can ensure sustained demand and funding for our burgeoning space economy", said Anil Prakash, DG, SIA-India. Also read: India to help Mauritius launch a satellite; extends support on Chagos To further liberalize the space sector, in February 2024, the Indian Government permitted Foreign Direct Investment(FDI) in this strategic domain. This is a bold move that would help infuse foreign capital into Indian space ventures. "We also anticipate the continued streamlining of Foreign Direct Investment (FDI), a critical policy lever for the private Space sector, poised to significantly enhance capital accessibility and drive ecosystem growth forward," said Chaitanya Dora, CFO & Co-Founder of Dhruva Space.

Indian budget 2024: A $120mn VC fund to propel India's nascent space startups 

In line with the Indian Government's vision of supporting emerging startups in the country's space sector, IN-SPACe, the sector regulator and facilitator has established and inaugurated the IN-SPACe technical centre in Bopal, Ahmedabad. This new facility is equipped with the resources to support the fledgling firms in designing, developing, simulating and testing of space technologies. The Government is offering these facilities to startups, as most firms would not be able to set up such expensive facilities on their own.&nbsp;

As we aim to grow our share in the global space economy share from 2 per cent to 8 per cent by 2033, we have come up with new policies and eased restrictions for investments as well as space startups. The opening up of FDI in the space sector is one such progressive step to boost private space efforts and make India self-reliant in space technology, said Dr. Jitendra Singh, Minister of State (Independent Charge) Science &amp; Technology.&nbsp;

Also read |&nbsp;<a href="https://www.wionews.com/india-news/pm-modi-inaugurates-indias-first-underwater-metro-other-projects-worth-220mn-697087">PM Modi inaugurates India's first underwater metro, other projects worth $220mn</a>

According to Indian National Space Promotion and Authorization Centre, (IN-SPACe), the centre features a range of facilities including the Climate Simulation Test Facility (CSTF), the Thermal and Vacuum Environment Simulation Facility (TVAC), the Vibration Test Facility (VTF), the Space Systems Assembly Integration Testing &amp; Checkout Laboratory, the RF and Opto-Electronics Laboratory and Clean Rooms for Assembly, Integration and Testing activities.&nbsp;

Simply put, these facilities would help firms test their hardware under harsh space-like conditions. For example, during a rocket flight, a satellite is subject to high levels of noise and vibration from the launch vehicle that is piercing through the dense layers of earth's atmosphere and heading towards space. Likewise, once in space, the satellite faces extreme temperature variations and exposure to radiation. Therefore, it is important to intensively test expensive space hardware for operating in such conditions before getting them integrated into a rocket or satellite.&nbsp;

Also read |&nbsp;<a href="https://www.wionews.com/business-economy/singapore-approves-air-india-vistara-merger-with-conditions-report-697049">Singapore approves Air India-Vistara merger with conditions: Report</a>

Dr Pawan Goenka, Chairman of IN-SPACe, emphasised the collaborative opportunities the Centre offers, "IN-SPACe Technical centre is equipped with&nbsp;state-of-the-art technical facilities for simulation, assembly and integration of space systems, and collaborative workspaces, with an aim to create a one stop solution for Non-Government Entities to transform their initial designs into full-fledged space products/solutions. By enabling access to essential development and testing infrastructure under one roof, IN-SPACe endeavours to democratise availability of tech-infrastructure for all Space NGEs from early stage startups to large established companies, and create conducive ecosystem for private industry to grow in the space sector".

In line with the Indian Government's vision of supporting emerging startups in the country's space sector, IN-SPACe, the sector regulator and facilitator has established and inaugurated the IN-SPACe technical centre in Bopal, Ahmedabad.

In line with the Indian Government's vision of supporting emerging startups in the country's space sector, IN-SPACe, the sector regulator and facilitator has established and inaugurated the IN-SPACe technical centre in Bopal, Ahmedabad. This new facility is equipped with the resources to support the fledgling firms in designing, developing, simulating and testing of space technologies. The Government is offering these facilities to startups, as most firms would not be able to set up such expensive facilities on their own. As we aim to grow our share in the global space economy share from 2 per cent to 8 per cent by 2033, we have come up with new policies and eased restrictions for investments as well as space startups. The opening up of FDI in the space sector is one such progressive step to boost private space efforts and make India self-reliant in space technology, said Dr. Jitendra Singh, Minister of State (Independent Charge) Science & Technology. Also read | PM Modi inaugurates India's first underwater metro, other projects worth $220mn According to Indian National Space Promotion and Authorization Centre, (IN-SPACe), the centre features a range of facilities including the Climate Simulation Test Facility (CSTF), the Thermal and Vacuum Environment Simulation Facility (TVAC), the Vibration Test Facility (VTF), the Space Systems Assembly Integration Testing & Checkout Laboratory, the RF and Opto-Electronics Laboratory and Clean Rooms for Assembly, Integration and Testing activities. Simply put, these facilities would help firms test their hardware under harsh space-like conditions. For example, during a rocket flight, a satellite is subject to high levels of noise and vibration from the launch vehicle that is piercing through the dense layers of earth's atmosphere and heading towards space. Likewise, once in space, the satellite faces extreme temperature variations and exposure to radiation. Therefore, it is important to intensively test expensive space hardware for operating in such conditions before getting them integrated into a rocket or satellite. Also read | Singapore approves Air India-Vistara merger with conditions: Report Dr Pawan Goenka, Chairman of IN-SPACe, emphasised the collaborative opportunities the Centre offers, "IN-SPACe Technical centre is equipped with state-of-the-art technical facilities for simulation, assembly and integration of space systems, and collaborative workspaces, with an aim to create a one stop solution for Non-Government Entities to transform their initial designs into full-fledged space products/solutions. By enabling access to essential development and testing infrastructure under one roof, IN-SPACe endeavours to democratise availability of tech-infrastructure for all Space NGEs from early stage startups to large established companies, and create conducive ecosystem for private industry to grow in the space sector".

India: Space startups get new facility to design, develop, simulate and test tech

Indian Space startup, Skyroot Aerospace, has proven the crucial propulsion technology of their maiden rocket Vikram-1, with the latest test-firing of an engine. Vikram-1 rocket is powered by four engines- three solid-fuel stages and one Liquid-fuel stage that the firm has designed and developed. In August this year, the company had tested their liquid-fueled engine and now has proven the technology of the solid-fueled engine(Kalam-5), by successfully test-firing a miniature version.&nbsp;

Solid motors or solid-fueled engines are high thrust, low-cost rocket engines with propellant in solid form. They are highly reliable as they have very few moving parts. The Engine Testing was done at a private test facility on Dec 22nd in Nagpur owned by Solar Industries, which is India's largest explosives manufacturer and a leading Space and Defence contractor (also partner and investor in Skyroot).&nbsp;

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Theoretically, this means that the company is close to realizing their dreams of putting together an orbital-class rocket, as its propulsion technology is the hardest to master.&nbsp;

A typical rocket consists of two or more stages, each of which would have its own engines(either single or packed in a cluster). Simply put, a rocket is a combination of multiple engines(stages) that are vertically stacked.&nbsp;

“This test demonstrates the capability of our technology for the Vikram-1 rocket. Though we have fired a scaled-down engine during this successful demonstration, it must be noted that building a smaller engine is also a complex process. This successful test firing gives us the confidence that the bigger models will succeed” Pawan K Chandana, CEO, Skyroot Aerospace told Zee Media.&nbsp;

The Engine ‘Kalam-5’, is named so for its peak Sea Level thrust of 5.3kN. It is notable that the engine is built with an advanced carbon composite structure in a completely automated process. While Carbon composite cases are very challenging to design and manufacture, they are five-times lighter than steel, hence improving efficiency. Kalam is a series of five solid-fueled rocket engines with a thrust ranging from 5kN to 1000kN (approx 100Tons). In terms of technical specifications, Kalam-5 is designed to take 66 atmospheres and 30000C of combustion pressure and temperature respectively.&nbsp;

Team Skyroot had earlier told Zee Media that they were planning a maiden launch by December 2021. They added that the decision to launch a live satellite or a dummy payload would be taken by mid-2021, based on demand.&nbsp;

Indian Space startup, Skyroot Aerospace, has proven the crucial propulsion technology of their maiden rocket Vikram-1, with the latest test-firing of an engine. Vikram-1 rocket is powered by four engines- three solid-fuel stages and one Liquid-fuel stage that the firm has designed and developed.

Indian Space startup, Skyroot Aerospace, has proven the crucial propulsion technology of their maiden rocket Vikram-1, with the latest test-firing of an engine. Vikram-1 rocket is powered by four engines- three solid-fuel stages and one Liquid-fuel stage that the firm has designed and developed. In August this year, the company had tested their liquid-fueled engine and now has proven the technology of the solid-fueled engine(Kalam-5), by successfully test-firing a miniature version. Solid motors or solid-fueled engines are high thrust, low-cost rocket engines with propellant in solid form. They are highly reliable as they have very few moving parts. The Engine Testing was done at a private test facility on Dec 22nd in Nagpur owned by Solar Industries, which is India's largest explosives manufacturer and a leading Space and Defence contractor (also partner and investor in Skyroot). Theoretically, this means that the company is close to realizing their dreams of putting together an orbital-class rocket, as its propulsion technology is the hardest to master. A typical rocket consists of two or more stages, each of which would have its own engines(either single or packed in a cluster). Simply put, a rocket is a combination of multiple engines(stages) that are vertically stacked. “This test demonstrates the capability of our technology for the Vikram-1 rocket. Though we have fired a scaled-down engine during this successful demonstration, it must be noted that building a smaller engine is also a complex process. This successful test firing gives us the confidence that the bigger models will succeed” Pawan K Chandana, CEO, Skyroot Aerospace told Zee Media. The Engine ‘Kalam-5’, is named so for its peak Sea Level thrust of 5.3kN. It is notable that the engine is built with an advanced carbon composite structure in a completely automated process. While Carbon composite cases are very challenging to design and manufacture, they are five-times lighter than steel, hence improving efficiency. Kalam is a series of five solid-fueled rocket engines with a thrust ranging from 5kN to 1000kN (approx 100Tons). In terms of technical specifications, Kalam-5 is designed to take 66 atmospheres and 30000C of combustion pressure and temperature respectively. Team Skyroot had earlier told Zee Media that they were planning a maiden launch by December 2021. They added that the decision to launch a live satellite or a dummy payload would be taken by mid-2021, based on demand.

Skyroot Aerospace becomes first Indian company to test fire a solid-fueled rocket engine

From companies building palm-sized satellites to those aiming to propel satellites into space using cleaner fuels, a new wave of space technology startups are mushrooming in India, catching the attention of investors keen to join the space race.

Bengaluru-based Bellatrix Aerospace, which wants to propel satellites into orbit using electric and non-toxic chemical thrusters, has raised $3 million from a group of investors, co-founder Yashas Karanam told Reuters.

Venture capital fund IDFC Parampara is leading Bellatrix's pre-Series A round. The family office of Suman Kant Munjal, who belongs to the billionaire family that controls Indian motorcycle maker Hero MotoCorp, and Deepika Padukone, one of Bollywood's biggest stars, are two of the other seven investors.

Meanwhile, Mumbai-based Kawa Space, which designs and operates earth observation satellites, has closed a seed round of an undisclosed amount, one of its investors, Vishesh Rajaram, managing partner at Speciale Invest, told Reuters.

Bellatrix and Kawa are two of over a dozen Indian startups developing satellites, rockets and related support systems which can power space missions serving a range of industries.

Their fundraising represents a big leap in private space investments in India, a leading space power but where the government has enjoyed a near-monopoly for decades.

"No venture capital firm which does tech investments in India has invested an amount of this size in space technology before," said Narayan Prasad, co-founder of online space products marketplace Satsearch, referring to Bellatrix's funding.

Besides Bellatrix and Kawa, seven space technology companies in India are funded, according to startup data tracker Tracxn and interviews with investors.

Space technology is red hot thanks partly to activity happening 2,000 km (1,200 miles) above the earth in the low-earth orbit, much closer and easier to reach than the geostationary orbit where many communications satellites operate.

Here, small and cheaper satellites are snapping images used in everything from crop-monitoring and geology to defence and urban planning, bringing down costs and increasing the frequency of images.

'Exciting times'

In the past five years, some two dozen Indian startups have grown into unicorns - companies with over $1 billion valuations - most betting on India's growing middle-class and the consumer boom at home.

India's space technology firms are part of a new breed of startups, and investors are paying attention, given the surging global interest in everything from space exploration to space vacations.

Satellite launches planned in the coming years worldwide give investors confidence in such companies, said Bellatrix investor Jatin Desai, whose Parampara Capital collaborated with lender IDFC to form IDFC Parampara.

"That gives us a large addressable potential market," Desai said.

Over 17,000 small satellites could be launched between 2018 and 2030, consulting firm Frost &amp; Sullivan estimates.

"There is money to be made ... These are exciting times for lots of entrepreneurs," said Rajaram, whose Speciale Invest has bet on three space startups in India.

Long gestation period

To be sure, investors aren't opening the coffers for India's space startups in large numbers just yet.

Indian venture capital firms Maple Capital, Ideaspring Capital, Bharat Innovation Fund and 3one4 Capital, say they have held talks with space startups but are taking a wait-and-watch approach.

"The gestation period is long by the time you see returns," said Naganand Doraswamy, managing partner at Ideaspring, referring to the multiple stages of development, testing and government approvals involved in space missions.

The state-run Indian Space Research Organization (ISRO), currently preparing for its second lunar mission, has a monopoly on launching rockets in India.

Still, Indian firms are free to use ISRO's rockets or overseas launch services such as Elon Musk's SpaceX or New Zealand and Los Angeles-based Rocket Lab to send satellites to space.

Most Indian space startups are hopeful that parliament will pass a long-pending space law, which will give clarity on how private companies can operate in the sector.

The administration of Prime Minister Narendra Modi has sought suggestions from stakeholders for a draft Space Activities Bill, which it has said could "possibly" be introduced in parliament this year.

Bellatrix Aerospace's first customer is ISRO, which is also mentoring the company as it readies a water-based propellant to help manoeuvre satellites in space.

Bellatrix is not the only company racing to develop newer satellite propulsion systems, with at least three others overseas reportedly working on similar products.

The company says its systems are affordable, less toxic and much lighter, providing more room for payload on satellites. "This will be the future," co-founder Karanam said.

From companies building palm-sized satellites to those aiming to propel satellites into space using cleaner fuels, a new wave of space technology startups are mushrooming in India, catching the attention of investors keen to join the space race.

From companies building palm-sized satellites to those aiming to propel satellites into space using cleaner fuels, a new wave of space technology startups are mushrooming in India, catching the attention of investors keen to join the space race. Bengaluru-based Bellatrix Aerospace, which wants to propel satellites into orbit using electric and non-toxic chemical thrusters, has raised $3 million from a group of investors, co-founder Yashas Karanam told Reuters. Venture capital fund IDFC Parampara is leading Bellatrix's pre-Series A round. The family office of Suman Kant Munjal, who belongs to the billionaire family that controls Indian motorcycle maker Hero MotoCorp, and Deepika Padukone, one of Bollywood's biggest stars, are two of the other seven investors. Meanwhile, Mumbai-based Kawa Space, which designs and operates earth observation satellites, has closed a seed round of an undisclosed amount, one of its investors, Vishesh Rajaram, managing partner at Speciale Invest, told Reuters. Bellatrix and Kawa are two of over a dozen Indian startups developing satellites, rockets and related support systems which can power space missions serving a range of industries. Their fundraising represents a big leap in private space investments in India, a leading space power but where the government has enjoyed a near-monopoly for decades. "No venture capital firm which does tech investments in India has invested an amount of this size in space technology before," said Narayan Prasad, co-founder of online space products marketplace Satsearch, referring to Bellatrix's funding. Besides Bellatrix and Kawa, seven space technology companies in India are funded, according to startup data tracker Tracxn and interviews with investors. Space technology is red hot thanks partly to activity happening 2,000 km (1,200 miles) above the earth in the low-earth orbit, much closer and easier to reach than the geostationary orbit where many communications satellites operate. Here, small and cheaper satellites are snapping images used in everything from crop-monitoring and geology to defence and urban planning, bringing down costs and increasing the frequency of images. 'Exciting times' In the past five years, some two dozen Indian startups have grown into unicorns - companies with over $1 billion valuations - most betting on India's growing middle-class and the consumer boom at home. India's space technology firms are part of a new breed of startups, and investors are paying attention, given the surging global interest in everything from space exploration to space vacations. Satellite launches planned in the coming years worldwide give investors confidence in such companies, said Bellatrix investor Jatin Desai, whose Parampara Capital collaborated with lender IDFC to form IDFC Parampara. "That gives us a large addressable potential market," Desai said. Over 17,000 small satellites could be launched between 2018 and 2030, consulting firm Frost & Sullivan estimates. "There is money to be made ... These are exciting times for lots of entrepreneurs," said Rajaram, whose Speciale Invest has bet on three space startups in India. Long gestation period To be sure, investors aren't opening the coffers for India's space startups in large numbers just yet. Indian venture capital firms Maple Capital, Ideaspring Capital, Bharat Innovation Fund and 3one4 Capital, say they have held talks with space startups but are taking a wait-and-watch approach. "The gestation period is long by the time you see returns," said Naganand Doraswamy, managing partner at Ideaspring, referring to the multiple stages of development, testing and government approvals involved in space missions. The state-run Indian Space Research Organization (ISRO), currently preparing for its second lunar mission, has a monopoly on launching rockets in India. Still, Indian firms are free to use ISRO's rockets or overseas launch services such as Elon Musk's SpaceX or New Zealand and Los Angeles-based Rocket Lab to send satellites to space. Most Indian space startups are hopeful that parliament will pass a long-pending space law, which will give clarity on how private companies can operate in the sector. The administration of Prime Minister Narendra Modi has sought suggestions from stakeholders for a draft Space Activities Bill, which it has said could "possibly" be introduced in parliament this year. Bellatrix Aerospace's first customer is ISRO, which is also mentoring the company as it readies a water-based propellant to help manoeuvre satellites in space. Bellatrix is not the only company racing to develop newer satellite propulsion systems, with at least three others overseas reportedly working on similar products. The company says its systems are affordable, less toxic and much lighter, providing more room for payload on satellites. "This will be the future," co-founder Karanam said.

India's space startups ignite investor interest

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