India’s Space Programme: A Role for the Private Sector, Finally? - The Wire, 22 May 2020

Last week, I wrote a short essay for The Wire regarding the recent announcement by India's Finance Minister Nirmala Sitharamn about the role of private sector in India's space programme.

India’s finance minister Nirmala Sitharaman announced last week that India’s private sector will play a key role in augmenting India’s space programme, and that the government intends to share the facilities of the Indian Space Research Organisation (ISRO) with the private sector. This announcement was part of the Narendra Modi government’s call for new and bold reforms in an effort to promote its ‘self-reliant India’ mission. It is the fourth segment of the Rs 20 lakh crore Aatma Nirbhar Bharat Abhiyan special economic stimulus.

For the full essay, click here.



Sitharaman’s announcement entails a role for the private sector, possibly with the goal of greater investments in technology development and acquisition, capacity-building and space exploration, including planetary exploration. The minister, while announcing these reforms, appeared to understand that the private sector can help augment India’s space capability. While praising the work done by ISRO, she also pointed out that the private sector is also doing a lot of work in developing space technology. She also acknowledged that the existing regulations prevent private entities from using or even testing their products.

Therefore, to level the playing field, the government “will make a provision for the private sector to benefit from the assets which are available to ISRO and for India (in general) to benefit from.” The minister also said the new reforms would allow the private sector to play an active role in “satellites, launches and space-based services”.

But as always, implementation is key. Properly executing these reforms will require enabling policies and appropriate regulatory frameworks.

That the new reforms will allow private sector players to use ISRO facilities is a big deal. This indeed must be music to the ears of commercial players who have been seeking to get a fair share of the pie in terms of manufacturing of satellites and propellant technologies, among other areas. It should not be too difficult for India’s private space sector because there is a sizeable talent pool available outside ISRO. More importantly, the entry of the private sector, as in the telecom sector, can bring several advantages in terms of cost and access.

Following the announcement, ISRO tweeted that it will follow the government’s guidelines to allow the private sector to undertake space activities in the country. Though this did not seem particularly welcoming of the government’s initiative, ISRO’s support is critical to making it a success.

ISRO has in the last few years been opening up to the Indian private space sector in a gradual manner – mostly as a matter of compulsion because ISRO simply does not have the in-house capacity to address India’s growing requirements. Today, the Indian space programme is not just about civilian applications for remote-sensing, meteorology and communication, as in the early decades. India’s space sector and its requirements have grown enormously in the last decade to include television and broadband services, space science and exploration, space-based navigation and, of course, defence and security applications.

Among others, Ambassador Rakesh Sood has articulated the need for legislation to facilitate ISRO’s partnership with industries and entrepreneurs. Narayan Prasad and Prateep Basu, two prominent faces in the Indian space start-up segment, have argued that despite ISRO’s successes, “India’s space competitiveness has suffered from the absence of a globally reputed, private space industry.”

The private sector, especially the NewSpace industry and start-ups, have an advantage in terms of low-cost operations, which itself should be a big incentive for the government to make it an active stakeholder. A certain amount of democratisation of space technology with the participation of the private sector can ensure costs are kept low. And expanding the number of stakeholders will also ensure more transparency and better accountability and regulatory practices. This has been missing in India’s space sector. The same agency has undertaken promotion, commercialisation and regulatory functions – which is not healthy.

Following the minister’s announcement, I spoke to a few key players in the private sector to capture their sense of the reforms in the pipeline. Sadly, the general mood is not one of excitement but rather to wait and watch. To them, as stated earlier, the key is implementation. One of them, who did not wish to be named, argued that unless there is a conducive structure for the private sector to engage with, the announcement is more lip service. Narayan Prasad said that there need to be basic changes for the reforms to be effective. The private sector is particularly concerned about issues such as sharing intellectual property for products developed by the private sector. Prasad argued that IP-centric policymaking has to be taken for real reform.

Right now, ISRO thinks they will use the suppliers only as manufacturing or services partners. So all IP is controlled by ISRO and suppliers just replace ISRO technicians and production facilities. This means most suppliers have no real IP of their own, and just depend on cost plus contracts from ISRO for business. The only way to change that is to create reforms where local industry can invest in building their own IP and/or products that can match global standards.

This in turn means that policymakers will need to view industry as more than sweatshops and look at what steps can be taken for IP/product development by private industry. This is the only way to integrate India’s private sector into the global supply chain. Prasad adds that if ISRO is serious about partnering with the private sector, it must spell out the requirements and select the best available. Several private-sector actors have articulated the need for an independent regulator.

This is an area that has been a common thread in many of my conversations with Indian entrepreneurs. Rohan M. Ganapathy, CEO and CTO of Bellatrix Aerospace in Bengaluru, also made a strong case for an autonomous regulator, and acknowledged a need for the government to clarify R&D risk funding, which is crucial to realise new technologies.

It is not that ISRO has not engaged the private sector. ISRO has long been associated with private firms like Larsen & Toubro, Godrej and Walchand Nagar Industries. It is just that the mode of participation envisaged through the new reforms is very different. The current mode of work, more of an outsourcing model, is becoming inadequate. In the last few years, because of significant capacity deficit, ISRO began to work with a few in the private sector such as the Bengaluru-based Alpha Design Technologies, contracted to build satellites. Similarly, Bellatrix Aerospace began to work with ISRO on advanced in-space propulsion systems. But these remain exceptions.

But ISRO does recognise the new compulsions and has been trying to change. The newly formed commercial enterprise called the NewSpace India Limited (NSIL), under the Department of Space, is an initiative to engage the private sector. NSIL is meant to help the private sector with transfer of some technologies to the private sector, especially the small satellite launch vehicle that is being developed and even the older PSLV. But the pace of ISRO’s engagement with the private sector needs to quicken.

Followed up effectively, the new government initiatives could help. Indeed, ISRO needs to expand its operations significantly if it has to remain competitive, both from a domestic and international outlook. The Indian space programme has several advantages, the most important being cost: the ability to provide reliable launches in a cost-effective manner is a big advantage. The Polar Satellite Launch Vehicle remains a tried and tested launch vehicle and has managed to remain the cheapest for launching small satellites into space. But competition in this sector is picking up.

Jeff Bezos’ Blue Origin, Elon Musk’s SpaceX and start-ups from China want a share of the global commercial market, estimated to be worth around $350 billion (Rs 26.46 lakh crore). If ISRO does not improve its launch infrastructure and increase the number of launches, it will be at a disadvantage. And despite India’s cost advantages, it has a mere 2% share of this, worth $7 billion. India can gain significantly if ISRO and the country’s private space sector can cooperate effectively and synergistically. This requires the government to actually act on the initiatives it announced.

The ISRO isn’t enough. India needs its own Elon Musk or Jeff Bezos - The Quartz, 19 July 2019

In a first, I write for The Quartz on the Indian space programme and its future plans. India's civil space organisation, the Indian Space Research Organisation (ISRO) has come a long way in the last five decades and is one of the public sector institutions working well but to stay competitive into the future, ISRO has to become innovative and find ways to bring on board India's private sector.

After five decades, India’s space program has evolved considerably, and has finally earned its right to be considered an established space player. But the future looks complicated.

For the full essay, click here.



The Indian Space Research Organisation (ISRO)—India’s NASA, if we must—was established a few decades after the country gained independence. At the time, the government had to justify spending precious resources on a space program when millions of its people were mired in poverty. For this reason, India’s space program has focused on developmental missions right from the beginning; mainly establishing communication satellites, weather forecasting, and remote sensing technology. It has since become one of the most cost-effective space industries in the world.

India’s Mars Orbiter Mission, or Mangalyaan (“Mars craft” in Hindi), cost around $73 million—less than what it cost to make Hollywood space films like Gravity and The Martian, as some like to point out. The recently rescheduled Chandrayaan-2 mission to land an Indian lunar module on the moon was similarly cost efficient.

Of course, we have to acknowledge that India’s space missions have been far less ambitious and complicated, and have carried much smaller payloads compared to those of global space giants like NASA.

Growing private sector pains
The program now faces a serious capacity crunch in meeting its mission requirements, which has compelled the ISRO to begin reaching out to the private sector, specifically to engage small Indian commercial space enterprises. The Bangalore-based Alpha Design Technologies Private Limited was commissioned to manufacture a series of satellites. Bellatrix Aerospace Private Limited has been contracted to work on advanced in-space propulsion systems.

But collaborating with the private sector has not been an easy move for the government-funded (and managed) ISRO.

Take, for example, when the program decided to privatize one of its smaller rockets, the Polar Satellite Launch Vehicle, or PSLV, about a decade back. The PSLV is a tried and tested rocket. Passing it on to the private sector should have permitted the ISRO to focus on other more vital areas such as developing new, larger rockets, or focusing on human space flight and space exploration.

But bureaucratic resistance to helping India’s private space enterprises, even from within the ISRO, means the organization still has not succeeded in transferring the PSLV to the private sector.

This is not to suggest that the ISRO is entirely against private sector participation in the country’s space sector. Earlier this year the Indian Cabinet approved a new commercial enterprise called NewSpace India Limited, or NSIL, under India’s Department of Space.


It has been yet another effort to build ISRO’s relationship with the private sector and to expand the commercialization of the Indian space program as a whole. The NSIL is supposed to help with technology transfer from the ISRO to private players, including India’s small satellite launch vehicle program and the older PSLV.

The NSIL is also meant to help promote space-based products and other spin-off technologies.

The cost factor, as it turns out, remains an exceptional aspect of India’s space program.
It’s difficult to predict where this new private-sector experiment will take the ISRO, but if we look back to one previous attempt with a similar initiative, the Antrix corporation, we should be somewhat concerned. The Antrix Corporation was set up in 1992 and became the first commercial initiative within the ISRO. Its primary objective was to facilitate ISRO’s commercial launch of foreign satellites, but it’s yielded underwhelming results.

Is cost-effectiveness enough?
The cost factor, as it turns out, remains an exceptional aspect of India’s space program. ISRO’s PSLV remains the workhorse of the agency, and it still offers one of the cheapest and most reliable ways to launch small satellites into space.

There are plenty of other private and state players in the small satellite launch market, such as Jeff Bezos’ Blue Origin, Elon Musk’s SpaceX, and others, including competitive start-ups in China. But the PSLV has been remarkably durable, consistent, and is still one of the most attractive options from an industry standpoint.

The launch list
The ISRO has a long way to go if it wants to fully exploit its advantages. For one, it has to be much more proactive in seeking deals with foreign markets. If India used space as an effective tool for diplomacy, it would bring in some much-needed revenue to the Department of Space, and it would also help expand India’s strategic reach into other countries.

India has to increase its number of missions per year if the ISRO wants to remain competitive.

The country has taken on the impressive challenge of doubling its average to 12 missions per year in a five-year period, but the true challenge is sustaining this rate into the foreseeable future.

This is a crucial step if India plans to capture a sizeable chunk of the global commercial space market, especially with keen competitors like China, which has committed to launching 30 satellite in 2019.

Other urgent action points for the ISRO include increasing its launch infrastructure starting with the number of launch pads. The same goes for its satellite manufacturing capabilities.

Not only is partnering with emerging private space enterprises a viable and ready solution to the ISRO’s capacity problems, but it will not diminish ISRO’s importance—look at the US’s successful and heavily privatized national space sector as an example.

Getting the private sector to shoulder some of the burden will not diminish the importance in India’s space story. If anything, it will bolster India’s economic reputation.

By passing on routine commercial launch activities to the private sector, the ISRO could position itself to focus on even bigger missions. It can turn its attention to major plans like Gaganyaan, India’s mission to human space mission planned for 2022, set to coincide with India’s 75th year of independence.

We find ourselves at an interesting and complex juncture with India’s national space program. The ISRO’s profile has grown in recent years, with major initiatives like the Mars mission ranking India in with the top five global players in outer space.

But India’s ability to stay competitive at a time when there are a growing number of space actors—including commercial ones—depends on the country’s willingness to embrace its own private sector to stay on a level playing field.

No, China Is Not About to Overtake the US in Space

Here's an essay written by my colleague Arvind and I on China's growth particularly in the space domain, published by the Diplomat on October 02, 2013.

China’s growth trajectory overall and more particularly in the space domain has been impressive. However, John Hickman’s categorical assertions in a recent Foreign Policy article that China is catching up and “may surpass the United States… to become the world’s preeminent spacefaring power” seems to us a touch far-fetched.

For the full essay, click here.

Certainly Hickman is right about Chinese determination and the “unquantifiable” factor of “an extraordinary sense of historical grievance” being a major driver of Chinese space dreams. China attributes its “military technological backwardness” to its past national humiliation at the hands of other major powers. Indeed, this is an important part of the national psyche and helps drives the Chinese space programs.

The problem lies in the tools needed to turn determination into material outcomes. The most important: China has nothing near the commercial space sector that the U.S. boasts. Sure, NASA now gets less than 1 percent of the U.S. federal budget, but much of America’s true capabilities are embedded in its private sector, which plays a much larger role than its equivalent does in China’s space sector and gives the U.S. a major advantage in space technology innovation. Not to mention the fact that the high-tech and defense sectors also contribute and the U.S. lead there is not going to disappear anytime in the next several decades.

China is taking steps to beef up its own commercial space sector (read: state-owned enterprises) but it still lacks the massive private-sector investment in R&D that will be vital to sustaining the success of any space program. For now, China must rely on public investment to advance its space program.

A Need for Innovation

More importantly, China does not innovate, it copies. That helps it catch up, but without innovation China will have difficulty taking over the top spot. Its growth looks like a parabola, approaching the number one spot before falling away.

Although China’s space program has come a long way since its launch failures in 1995 and 1996, that dramatic rise has been aided by the reverse engineering of Russian technology. For instance, many observers believe that the Shenzhou space capsule that heralded China’s manned space flight was based largely on the Russian Soyuz capsule. However, China’s ability to catch up with the other space superpowers by copying alone is fast approaching its limits. This is not helped by U.S. moves to isolate China with regard to international cooperation in space. The latter’s access to the latest technologies has consequently been restricted, a fact that even the Chinese are realizing, reflected in their recent drive to focus more on innovation.

Moreover, China lags significantly behind the U.S. generally in scientific innovation. Consider, as an example, that the U.S. is at the vanguard of revolutionizing manufacturing techniques with the use of 3D printing, which it intends to utilize in the International Space Station, or the involvement of NASA scientists in experiments that could bring them closer to the development of a warp-speed engine.

If ambition is cited as a factor for the possibility of Chinese dominance in space, then surely one must consider the U.S. aspiration to explore the far reaches of space. Even if China is quickly catching up with U.S. dominance in Low Earth Orbit (LEO), its program is largely restricted to that realm. The U.S. meanwhile has set its sights beyond our planet’s periphery.

While American satellites are exploring the far reaches of our solar system, with the Voyager 1 having reached interstellar space, closer to Earth satellites belonging to the U.S. and its partners outmatch Chinese satellites in number and scope. The former owns more than half of all satellites currently orbiting our planet. In terms of their capabilities, American satellites are still far superior to their Chinese counterparts.

Concerns regarding the decommissioning of the U.S. Space Shuttle Program may also be unfounded. NASA has already tapped the commercial sector to fill the gap in its human spaceflight capability. In the final phase of the Commercial Crew integrated Capability program (CCiCap), NASA signed an agreement with the Sierra Nevada Corporation, Space Exploration Technologies and the Boeing Company to develop commercial spaceships to launch American astronauts into orbit by 2015. This is not a sign of weakness; it is an indicator that U.S. national interests are closely aligned with the interests of the country’s commercial space sector.

In contrast, China’s commercial space sector is still very much nascent. In fact, China’s space sector is comparable to the Russian model: state sponsorship and commensurate state interference. Even though Russia continues to be one of the foremost space powers, it has experienced a sustained decline owing to financial constraints and manpower concerns. For China, the PLA’s stakes in aerospace companies are likely to encourage protectionist tendencies, which in turn block the emergence of other innovative thinkers. An underdeveloped private industry will limit the potential for innovation.

China’s impressive ascent in space capability has been driven by massive state financing. While this has undeniably worked well to date, the sustainability of this model as the Chinese economy rebalances is questionable. If state support is capped, or tapers, then with only a modest private sector to fill the gap it is difficult to see how China will sustain the extraordinary progress it has made over the past 15 years.

And finally another factor that must not be discounted is experience. American astronauts have logged thousands of hours of space flight. That gives them long experience dealing with issues China is just beginning to encounter.

Future Potential – With Reforms

Yet despite these limitations, China’s space program could continue to impress given sufficient time and patience. Maintaining the growth trajectory will, however, require reform. More opportunities and incentives for private-sector participation will encourage innovation, while reducing the burden on the public purse. While a political mandate has been issued for innovative thinking, Beijing needs to make the requisite institutional and structural changes that will allow that to happen. Those changes may also help protect the Chinese space program from economic vicissitudes.

In fact, China has shown it understands the importance of commercializing its space efforts. Fortunately, it does enjoy some tremendous commercial opportunities. In Latin America, countries like Venezuela are looking to the Chinese to supply space technology and launch services. There is also demand in Africa, which has already developed strong economic ties with the Chinese. Given that China also has the fastest-growing market for commercial space services on its doorstep, namely in Southeast Asia, there is ample potential to generate revenue to fund R&D. China should aggressively seek potential clients around the world and invest heavily in education.

Meanwhile, China could try to attract technical talent from abroad. This will, however, require more than generous remuneration, since it will be tough to match the American private sector in that regard. For China, this should be a long-term plan for educating the next generation of engineers. If the Chinese are willing to invest time and resources, a new generation could innovate and develop new technology, instead of reverse engineering, creating a slow but more certain path to preeminence.

Finally, dominance in space requires more than just technology. China will need to become a persuasive force in the making of space policy, and this in turn will require that it demonstrate an ability to act responsibly. Beijing’s 2007 anti-satellite test and the resulting space debris was an example of what not to do, especially as the U.S. managed to shoot down a satellite with minimal residual space debris.

So, yes, China has clearly made very significant strides in its space capability. However, it is still a long way short of matching U.S. capabilities and alarm bells need not ring just yet. China’s rise is a function of heavy state investment based on a model that is unlikely to be sustainable. The American model of public-private partnership is more innovative and less of a taxpayer burden. China will need to undertake significant reforms before it supplants the U.S. as the world’s leading space power.