RT team
The recent decision by the government to relax Foreign Direct Investment (FDI) regulations in the space sector is expected to invigorate India’s startup ecosystem in satellite manufacturing and assembly, industry experts suggest. This move, allowing 100% overseas investment in satellite component production, aims to attract foreign players and bolster private sector participation.
The revised policy delineates foreign investment limits across various segments, facilitating up to 74% FDI in satellite manufacturing and operations, among other sectors, through the automatic route. Beyond these thresholds, government approval becomes necessary.
Sreeram Ananthasayanam from Deloitte emphasizes the potential of this amendment to stimulate downstream applications, leveraging India’s IT and analytics capabilities. Mayank Arora from Nangia Andersen India underscores the importance of collaborations and technology transfers in establishing a robust space ecosystem.
With the global demand for satellite components rising, and over 200 startups already active in the sector, the reforms are poised to drive substantial growth. The private space industry in India, currently representing around two percent of the global space economy, is forecasted to expand significantly by 2040. According to Iqbal Khan of Shardul Amarchand Mangaldas & Co, these reforms mark a crucial step in the ongoing evolution of India’s space sector, aligning it with international standards and fostering global participation.
