India's Space Sector: ₹20,000 Crore Contribution to GDP and the Emerging Role of Private Players

What’s in today’s article?

• Why in News?
• Space Sector in India: Overview, Contributions, and Key Players
• Key highlights of the report

Why in News?

As per the report initiated by the Indian Space Research Organisation (ISRO), India’s space sector has directly contributed about $24 billion (₹20,000 crore) to India’s Gross Domestic Product over the last decade.

Space Sector in India: Overview, Contributions, and Key Players

• Overview
  • India's space sector has emerged as a significant player on the global stage, known for its cost-effective and innovative space missions. 
  • The journey began in 1962 with the establishment of the Indian National Committee for Space Research (INCOSPAR) under the leadership of Dr. Vikram Sarabhai, which later evolved into the Indian Space Research Organisation (ISRO) in 1969. 
  • Over the decades, India has developed robust capabilities in satellite development, launch vehicle technology, space exploration, and space applications.
• Contributions
  • Satellite Technology
    • Communication Satellites: The INSAT (Indian National Satellite System) and GSAT (Geostationary Satellite) series provide critical services in telecommunications, broadcasting, weather forecasting, and disaster management.
    • Remote Sensing: The IRS (Indian Remote Sensing) satellite series helps in resource management, agricultural monitoring, urban planning, and environmental conservation.
    • Launch Vehicle Technology:
      • Polar Satellite Launch Vehicle (PSLV): Known as ISRO's workhorse, PSLV is renowned for its reliability and versatility in launching satellites into various orbits. 
      • Geosynchronous Satellite Launch Vehicle (GSLV): GSLV, particularly the GSLV Mk III variant, is used for launching heavier satellites into geostationary orbits and is key to India's human spaceflight program.
  • Space Exploration:
    • Chandrayaan Missions: India's moon missions, Chandrayaan-1 (2008), Chandrayaan-2 (2019) and Chandrayaan-3 (2023) Chave significantly contributed to lunar science.
    • Mars Orbiter Mission (Mangalyaan): Launched in 2013, Mangalyaan made India the first country to successfully reach Mars in its first attempt, demonstrating advanced space technology at a fraction of the cost of similar missions by other countries.
  • Navigation Systems
    • NAVIC: The Navigation with Indian Constellation (NAVIC) is India's regional satellite navigation system, providing accurate positioning services over India and the surrounding region.
  • Role of Private Players
    • NewSpace India Limited (NSIL)
      • Established in 2019, NSIL is ISRO's commercial arm responsible for transferring technologies to the private sector, manufacturing launch vehicles, and providing satellite launch services.
    • Indian National Space Promotion and Authorization Center (IN-SPACe)
      • IN-SPACe is a regulatory body that promotes and authorizes private sector participation in space activities, ensuring fair and transparent access to space resources.
    • Private Companies
      • Companies like Skyroot Aerospace, Agnikul Cosmos, and Pixxel are emerging as key players in satellite manufacturing, launch services, and space applications.

Key highlights of the report

• About the report
  • The report was initiated” by ISRO to evaluate the socio-economic impact of the space sector from 2014-2023.
  • The study was conducted by Indian economics research firm econONE and Novaspace.
  • It was presented during the National Space Day celebrations in New Delhi on August 23, 2024.
    • The Space Day celebrations are to commemorate the first anniversary of the successful landing of the Chandrayaan-3 on August 23 last year.
• Key findings
  • Impact on Indian Economy
    • India’s space sector has directly contributed about $24 billion (₹20,000 crore) to India’s GDP over the last decade. 
    • It has directly supported 96,000 jobs in the public and private sector. 
    • For every dollar produced by the space sector, there was a multiplier effect of $2.54 to the Indian economy.
    • India’s space force was 2.5 times more productive than the country’s broader industrial workforce.
  • 8th largest space economy (in terms of funding) in the world
    • With $13 billion invested in the last decade it is the 8th largest space economy (in terms of funding) in the world.
    • Satellite communications contributed 54% to the space economy, followed by navigation (26%) and launches (11%).
    • Diversified space sector
    • The Indian space sector was diversifying and now had 700 companies including 200 start-ups. 
    • It had seen revenues grow to $6.3 billion in 2023, which was about 1.5% of the global space market.
  • Way ahead
    • India's space sector has significantly enhanced the nation's prestige, sovereignty, and global leadership, but its impact on the profitability and competitiveness of companies within the country has been limited. 
    • According to industry stakeholders, this is because the space program over the past decade has been primarily driven by political considerations. 
    • However, there is a shift occurring as commercial space is becoming a priority. 
    • Regulatory reforms have been introduced but have yet to fully take effect, and an under-developed venture capital ecosystem is hindering space technology start-ups from accessing necessary capital.

Q.1. How much has India's space sector contributed to the GDP in the last decade?

India's space sector has contributed approximately ₹20,000 crore to the GDP over the last decade, showcasing its significant impact on the nation's economy and technological advancements.

Q.2. What role do private players play in India's space sector? 

Private companies in India's space sector, such as Skyroot Aerospace and Agnikul Cosmos, are becoming key players in satellite manufacturing and launch services, driving innovation and commercialization in space activities.

Source: ‘Space sector contributed ₹20,000 crore to India’s GDP over the last decade’