Space for start-ups

A Nasa-like PPP policy could make India an aerospace powerhouse

The successful launch of Vikram-S, India’s first privately built rocket from start-up Skyroot, has focused welcome attention on the opening up of space to private enterprise. Assuming the eagerly awaited Space Policy is on expected lines, multiple aerospace start-ups as well as large companies will enter a sector with explosive growth potential. Alongside a larger share of the global space market, Indian entrepreneurs could develop many downstream applications and spin-offs.

Skyroot, a start-up with a lot of ties with the Indian Space Research Organisation (Isro), intends to launch two rockets a month once the technology stabilises. It is also looking to develop reusable rocket technology, something only SpaceX currently possesses. Other Indian firms are attempting to build rockets, launch-vehicles, and satellites with different capabilities. In addition, there are opportunities in satellite internet services and in downstream applications. As Isro goes ahead with planned manned missions, further areas of research will emerge. The global commercial space market is worth $360 billion and expected to grow to at least $500 billion by 2030. Both government agencies and private-sector firms are intent on launching satellites to service demands across areas ranging from internet broadband to entertainment delivery, climate monitoring, and multiple geo-location-based services.

India’s market share is just about $7 billion, which is tiny, given the impressive capacity developed by Isro. Cooperation with the private sector could help translate Isro’s demonstrated capabilities into exploiting business opportunities. Private participation could boost India’s market share to $50 billion, or roughly 10 per cent, by 2030. Previously Isro used to do the R&D and farm out to the private sector the job of manufacturing components in accordance with specifications. The change in policy envisages technology transfers from the agency to private players and also allows private players to use Isro facilities for launches and tests as Skyroot did.
 

This should enable private enterprise to move up the value chain from being component suppliers to players in the aerospace sector. In turn, it would improve Isro’s own capacities since the agency could concentrate on more demanding tasks such as building bigger rockets and satellites with more capacity and more sophisticated capabilities. The anticipated infusion of capital would be useful for everyone and, given the connections among space science, defence, weather management, geo-location, communications, entertainment and so on, it would enable a host of downstream sectors.

Apart from dozens of start-ups, big players are interested. For example, Isro will induct a batch of five Polar Satellite Launch Vehicles (PSLVs) which are being built by a consortium of Hindustan Aeronautics and Larsen & Toubro. This marks the first instance where an entire rocket has been built outside the agency (albeit using Isro technology). Hughes is in collaboration to deliver commercial broadband using Isro satellites. Airtel and OneWeb are also looking to enter the satellite broadband market as are several overseas players, including SpaceX and Amazon.

This model of private-public cooperation has worked well for the US space agency National Aeronautics and Space Administration (Nasa), which tenders out all its manufacture. It does some of its own designs and releases many patents. It also tenders out for innovative designs according to its specifications. For example, the reusable Falcon 9 rockets from SpaceX, as well as the Starlink satellite service from the same company, arose out of this policy. All the designs for Nasa’s Artemis Mission, which will send a manned mission to the moon, and establish a space station in orbit around the moon and a base on the surface, are being developed through private R&D working to Nasa specifications. The adoption of a similar policy could turn India into an aerospace powerhouse.