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Modi govt wants private sector in global space race, but it’s up to ISRO to make it happen

Right now, private players can only boast of delivering low-cost products and services to ISRO, but it needs to widen its customer base and develop more design capabilities.

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Berlin: The recent announcement of the Government of India to support the rise of the private sector in the space industry is signalling that policymakers are keen to see the Indian private companies capture a share of the global space market.

Is the private sector ready and capable of it? If not, how can the Indian Space Research Organisation (ISRO) help?

The present role of private sector 

The involvement of the private sector in India’s space programme received impetus during the leadership of Professor Satish Dhawan. The engagement model drawn up was on the basis that ISRO would share the know-how and also buy back the product/service from the private sector partner. This meant that scientists at ISRO could offload some of their routine work after establishing the initial Intellectual Property (IP).

From the private player’s perspective, ISRO did not have the volume of business where they could heavily invest in creating their own IP base and this engagement of technology transfer and buy back meant that the access to the know how came cheap and assured a customer.

This engagement model has been around for perhaps 50 years now and the one thing that has really changed over the course of time is the volume of satellites and rockets.

Statements by ISRO management share that there are a core group of about 150 companies that supply parts and services to the space programme.

If one has to understand the ability for the private sector to capture a share of the global market, one has to look under the hood at a company’s design knowledge and capabilities, which constitute its IP, and the engagement model so far.

Also read: Opening ISRO to private players — Modi govt’s latest space initiative echoes 2017 draft bill

IP is the basis for exports

The legacy model of transfer of IP and buy back from ISRO meant that the private sector has mostly absorbed the processes that go into producing space hardware, the quality control and the facilities for it. The critical piece that seems to be missing in the majority of the vendors serving the space programme is design knowledge and the ability to create their own IP and roll out products in the market.

This is one of the results of the mechanism of the industry involvement in the space programme not having changed much in the last five decades.

Yes, there has been some movement in the private sector to assemble satellites and rockets. But this again has been about simply removing ISRO personnel and adding labour from the private sector rather than having the private space sector contribute their own IPs.

ISRO has done a great job in training many of these vendors to match space standards and qualities. This model of engagement means that the lack of incentives to create IPs and incentives to only manufacture/provide labour/facilities make it extremely challenging for any of these legacy industry actors to sell in the global space market.

When these players try to sell globally, their primary proposition is mostly then low-cost production/service rather than strong IP-based product exports.

Therefore, the fundamental shift needed in the next decade is looking at changing the 50-year-old model of industry engagement with ISRO to incentivise the private sector in investing in IP creation and development.

Also read: These are the 2 steps Modi govt needs to take for its space reforms to take off

Incentivising IP investments and development

To contrast what happens when right incentives are set to IP development, we could look at comparing the private space sector of South Africa and India.

The private space sector in South Africa exports over 90 per cent of the products they produce to the US, Europe and Asia. In contrast, the overwhelming majority of the private space players in India solely depend on ISRO for their business.

The government in South Africa has limited space capabilities and some of the university satellite programs have existed for decades in the country. This meant that the commercialisation happens on the basis of original IP that sees export as a primary market. South African companies also benefit from the lower cost of operations in the country (much like India). However, combining the control over the IP and the lower cost of operations makes their products extremely competitive in the international space market. This is where India’s private sector should look for inspiration.

The incentive for IP development goes hand in hand with the change in the procurement. Instead of constructing contracts on the basis of procuring labour or just production facilities, procurement can be on the basis of creating competition in IP development.

For example, stating that ISRO is willing to procure imagery from the private sector and publishing the image standards/coverage to be met can incentivise the private sector to use both ISRO IPs and create their own to build and operate their own satellites.

This would mean a win-win to both ISRO and the private sector. While ISRO can focus on long term technology and scientific developments, routine requirements can be met by the private sector. This will enable the private sector to use the developed space structures and capabilities to sell both the satellites and the imagery-based services in the global markets to add to their customer base.

The question though remains — whose job will it be to coordinate all of this and if leaderships in both ISRO and the legacy private sector are ready for such changes. Such risks are being taken by some of the emerging space startups but without much support from ISRO. If they succeed, they can stand as inspiration for much of these legacy models to change.

Narayan Prasad is the Chief Operations Officer of, a global marketplace for space supported by the European Space Agency and the host of the NewSpace India podcast.

Also read: India is a maturing space power, but can rival the US with an independent regulator


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  1. What Modi government? Useless government going on. Ru a journalist or paid media. U should deliver correct message Indian government ok. No government did such irresponsible activities like this. Isro is may sale tomorrow if these idiot ……

  2. Is it not putting the cart before the horse in such thinking by Modi Government in times of Corona, medical infrastructure development and employment generation?
    ISRO ans PPP partnership damn good idea bit look where the US Economy is in doing the same…….only the Ambanis and Adanis with families an fly off when the earth collapses is another loose thinking.
    I dont know, cant understand because to me there are other compelling reasons
    But the GoI knows best. The Constitution says so and there are no newer interpretations to the Constitution either.

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