SPACE TECH START-UPS IN INDIA

 

SPACE TECH START-UPS IN INDIA

Why in the News?


 Under Seed fund scheme, In-Space will provide support to start-ups for developing and scaling up solutions in urban development and disaster management sector using space technology. 

About Seed fund scheme 

Background: Seed fund scheme aimed at promoting space technology was announced by the IN-Space in March 2023. 
 
Purpose : To support space-start-ups to develop innovative space products and services that can improve the quality of life of common people in India and around the world. 
 Support to start _ ups:  Access to funding, Mentorship, Training and Network opportunities.
 
Sectors covered:In-SPACE to announces sector opportunities periodically.  

 Ideal Applicants: They Should have a clear business plan, a well-defined target market, and a detailed implementing strategy.  




Eligibility for start-ups:


 Start-ups should be registered with DPIIT and should be using technology as the core in its product or services.   Shareholding in start-ups by Indian should be 80% and company should not have gone through a funding round.  However, investment from venture capitalist is permitted.   Promoters and Angel investors investment in the start-up at the time of application must at least match the granted request.   Should not have received more than 50 lakh support under any other central/state schemes.   This does not include prize money from competition, subsidised working space, access to labs, or access to prototype facility. 

 • Funding to the start-Ups 

  Grant of up to 1 crore in three or more instalments, upto 40% may be given in first instalment.   Grant should be utilised fully within a period of three years.  IPR generated under the program shall be owned by start up Need for promoting Space-tech start-ups in India

 • Global Competitiveness: 

Foreign private companies like SpaceX, Blue Origin, Arianespace, etc.  have transformed the global space industry by cutting costs and turnaround time.   However, India’s private space players have mainly served as vendors or suppliers to the government's space program. Therefor to provide them a level playing field, Centre allowed them to carrying out end-to-end activities in the space domain. 

 • Harnessing opportunities in space economy:

 At present India’s share in this is only 2% which needs to be enhanced.   Innovative Start-ups could Complementing government’s resources to enhance our space economy.

  • Reducing import dependency: 

According to the Government data, India’s import costs in the space technology sector are twelve times higher than the earnings from exports.  The major imported items include electronic and electrical engineering components, high-strength carbon fibres, space-qualified solar cells, detectors, optics and power amplifiers among others

 • Freeing up the ISRO from ancillary activities: 

Start-ups participation could free up ISRO to focus in the core areas of research and development, interplanetary exploration, and strategic launches.

 • Spinoff soci0-economic benefits:

 By finding innovative solutions to pressing challenges in areas such as agriculture, disaster management, or communication, the private sector can bring significant improvement to people’s lives.  Additionally, boost to local manufacturing in space technology will generate employment  

• Geopolitical leverage: 

Collaboration between space-tech private players of India and partner countries, such as the US, will empower India as a counterbalance to China.   Indian space-tech start-ups could enable India to strategically offset the influence of China in the space arena. 


India’s Initiatives to promote space-tech start-ups 


• Key organisations 

 Indian National Space Promotion and Authorization Centre (IN-SPACe): 

It is an autonomous agency under the Department of Space (DoS).   Its role includes regulating, promoting, guiding, monitoring, and supervising the space activities of NonGovernmental Private Entities (NGPEs) in India.  It can also allow a NGPEs to use the facilities of DoS. 

  Antrix Corporation Limited (ACL): 

ACL, a commercial arm of ISRO, was setup in 1992 and is a wholly owned Government of India Company.  It is engaged in providing space products and services to international customers.

  New Space India Limited (NSIL):

 NSIL is a Schedule 'A' Category Company under DoS. It was set up in 2019, to handle the commercial activities of ISRO.   It enabling Indian industries to take up high technology -tech space activities and also promotes the commercial use of products and services from the Indian space program.  

Indian Space Association (ISpA): 

Established in 2020, ISpA is an apex non-profit industry body, setup for development of the private space industry in India.  Represented by leading domestic and global corporations, it aims to build global linkages, bringing critical technology and investments to the country. 

Other Initiatives 


 Indian Space Policy 2023:

 Enables end-to-end participation of Non-Government Entities (NGEs) in all domain of space activities. 

oForeign Direct Investment:

 FDI in space sector is allowed under Government route for satellite establishment and operations. The Dos and DPIIT is in the process of reviewing the FDI policy guidelines of space sector to attract more resources.

   Tax benefits:

 Satellite launches are exempted from GST. o Atal Innovation Mission (AIM) .ATL Space Challenge: AIM in collaboration with the ISRO and CBSE launched the Atal Tinkering Lab (ATL) Space Challenge. 
 
 It was open to all school students across the country and was presented with four broad challenge themes - Explore Space, Reach Space, Inhabit Space and Leverage Space.  

Atal Incubation Centre (AIC) Scheme: 

AIM has supported more than 15 startups working in Space Tech and related industry across India. The focus areas for these startups are in UAV, Drone and Surveillance Equipment, Aero tech, Air Taxi, Space debris tracking and monitoring service, space education among others.  

 ANIC_ ARISE program :It is a national initiative to promote research & innovation and increase competitiveness of Indian startups and MSMEs. Support is also being offered to space-tech stratups.
    Mentoring : List of retired ISRO subject experts is published on IN-SPACe Digital Platform (IDP). NGEs can approach these mentors directly for expert advice etc. 

Challenges in promotion of space-tech start-ups in India 


Risky Nature of industry :Absence of assured market and long incubation periods lead to a cautious approach by private organizations. 
Funding Constraints: Inadequate funding, especially in later stages, poses a significant challenge. Lack of indigenous materials and high reliance on imports increase costs and cause production delays. 
Unsustainable business models : Lowest cost wins mentality of start-ups overlooks hidden expenses and future impacts, leading to unsustainable business models.
 Limited Talent Pool : Scarcity of skilled professionals adds to existing challenges. Way ahead for promoting space-tech startups in India
 Enact Space Activities Bill : The Space Activities Bill will further provide clarity, focus, and propulsion for the industry.
  Enhance Financial Viability  : Establish soft funds and additional incentives (like more tax incentives, exemption), to address funding challenges.
 Secure Market Access:  Conduct a dedicated study to define the Indian space economy using consistent methodology.   Facilitate government contracts for private start-ups to foster market demand.   Ensure partnerships between start-ups, ISRO, and foreign companies to access expertise and markets 
Global Best Practices: Study global initiatives to develop and enhance the Indian space ecosystem.
 Capacity building: Emphasize academic programs on system development. Invest in training programs to enhance skills in systems engineering. Also, integrate the space segment as a unified system, bridging gaps in interdependence. 

Conclusion 

Moving forward, aligning government policies with the dynamic needs of the space industry and nurturing innovation among Space-tech start-ups will be crucial for India to realize its ambitions in the rapidly evolving space domain. 


  
























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