The Union Cabinet has eased regulations to allow 100% foreign direct investment (FDI) in the country’s space sector.
The relaxation of entry barriers, as outlined in the amended policy, is expected to attract investors to Indian space companies.
Under the revised policy framework, foreign direct investment up to 100% via the automatic route will now be permissible for the manufacturing of components, systems, or sub-systems related to satellites, ground segments, and user segments.
For satellite manufacturing and operations, satellite data products, ground segments, and user segments, up to 74% FDI under the automatic route will be permitted. Any investment beyond this threshold will necessitate government approval. Likewise, for launch vehicles, spaceports, and associated systems or subsystems, up to 49% of FDI will be allowed through the automatic route.
Crucial stakeholders, including the Department of Space, IN-SPACe, ISRO, NSIL, and various industrial entities, were extensively consulted in the formulation of this policy amendment.
The initiative is anticipated to bolster the capabilities of Indian companies in the space sector, fostering innovation, technology absorption, and self-reliance. Moreover, increased private sector involvement is poised to integrate Indian firms into global value chains, thereby bolstering initiatives like ‘Make in India’ and ‘Atmanirbhar Bharat’.