By Nivedita Bhattacharjee
This was originally published in the India File newsletter, which is issued every Tuesday. Sign up here to get latest news from India and how it matters to the world.
Greetings from Bengaluru, India’s mission control!
A pair of Indian spacecraft, each the size of a large refrigerator, made history for the world’s most populous nation last week, linking up in a high-precision manoeuvre that made India only the fourth country to complete a space-docking experiment.
It’s been a busy few days for space news from India, but what exactly is the government up to, and why? That’s our topic for discussion this week.
Meanwhile, Indian markets are looking ahead to the first full budget of Prime Minister Narendra Modi’s third term. Scroll down for more on how expectations are shaping up.
This week in Asia
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Pakistan’s Imran Khan handed 14-year jail term in land graft case
South Korea’s Yoon shuns questioning, as supporters face charges over court rampage
Chasing the moon, and money
A new global space race is under way, and this time, India is determined not to be left out. From rockets and earth imaging to space traffic management, innovations by Indian space startups have been coming at breakneck speed, spurred by government-led privatisation in the sector.
Spearheading this is the government’s space agency, ISRO, which has ambitious plans that include a mission to Venus and putting an Indian astronaut on the moon. The successes of the Chandrayaan-3 unmanned moon landing a year and a half ago and last week’s space docking milestone have propelled India into the rarefied ranks of countries – until now limited to the U.S., Russia and China – capable of such feats in space.
While some officials lament that India is still punching below its weight on the global stage despite growing into the world’s fifth-largest economy, India’s space boom is about more than just national pride.
Prime Minister Modi wants the space business to become a force for further economic growth. Between 2014 and 2024, the space sector contributed $60 billion to India’s GDP, including knock-on effects on employment and related businesses, according to findings in an unpublished ISRO-Novaspace study that were reported in local media.
India has a long way to go, however, to reach its target of $44 billion in revenue from the space business by 2033, a roughly five-fold increase from 2023. McKinsey estimates that the global space economy will be worth $1.8 trillion by 2035, up from $630 billion in 2023.
And while Indian private-sector space funding dropped last year, industry officials dismissed that as a blip in the investment cycle and expected a pick-up again this year.
In the meantime, the government and industry are moving swiftly on a number of fronts.
A new space regulator, IN-SPACe, has recruited companies for a private-public partnership on earth observation satellites, Indian companies have joined an India-U.S. space and defence collaboration programme, and the government has established a $119 million fund for space-related startups.
The country is also choosing its space battles carefully. It does not aim to take on Elon Musk in a head-on fight over heavy launch rockets, but is focusing on smaller satellites and launch vehicles, and on crunching space data – where it can establish itself as a reliable alternative to China and a partner to countries in the Global South.
“This is a sector that India can win,” AK Bhatt, director general of the Indian Space Association, told Reuters in an interview. “The country already has an historical advantage in data mining and interpretation.”
While India expects the private sector’s data science and AI powerhouses to lead its rise in the space business, industry players say that, to secure paying clients, they will need the government’s support as an anchor customer, as well as a further big push either from foreign investments or government funding.
How this partnership plays out could hold the key to India’s success in space. The government plans to offer infrastructure such as spaceports, technical advice from ISRO, and targeted funding, but sees itself with a limited role.
“Space is not for the faint hearted. While government will do its bit and support any which way, success will finally come to those who run with the ball, make big bets and have perseverance,” said IN-SPACe Chairman Pawan Goenka.
What do you think India’s chances are for success in space? Write to me at nivedita.bhattacharjee@thomsonreuters.com.
Quote of the week
“Nearly 100 individuals have been charged civilly or criminally by regulators at least in part through our work, including billionaires and oligarchs. We shook some empires that we felt needed shaking.”
Nate Anderson, founder of Hindenburg Research, announced over the past week that the firm is being wound down.
Hindenburg’s reports sparked heavy selling of shares by investors and wiped billions of dollars from the market value of India’s Adani Group, U.S.-based Nikola and others.
Market matters
Indian markets are eagerly awaiting the Feb. 1 release of the annual federal budget, which is expected to forecast stronger economic growth for the next financial year while sticking to fiscal goals.
The government could also boost spending on railways and the textile sector, aiming to create more jobs. Indian industry is seeking more infrastructure spending alongside tax cuts to reverse a slowdown in economic growth that emerged over the past several months.
The Modi-led government presented a budget in July after it was voted back into power but this will be the first full budget for its third term. Indian stocks had a mixed reaction in July, initially selling off because of a tax increase for equity investment gains, but eventually settling flat.
(By Nivedita Bhattacharjee; Editing by Edmund Klamann)
