India is soon going to allow 100 percent Foreign Direct Investment (FDI) in the space sector in three different sectors in an effort to encourage collaboration, innovation and technological advancements.
India is soon going to allow 100 percent Foreign Direct Investment (FDI) in the space sector in three different sectors in an effort to encourage collaboration, innovation and technological advancements. Once the policy becomes operational investors will be allowed to make investments in three different areas including sub-system manufacturing, launch vehicle operations, and satellite operations and establishments. The foreign investments in the three different activities will vary from 49 percent to 100 percent.
The draft of the FDI policy in the space sector has already been approved by the Space Commission according to reports quoting Pawan Goenka, chairman of the Indian National Space Promotion and Authorization Centre (IN-SPACe). This policy is expected to be released later this year.
Is this good or bad?
Sharing his views with Financial Express Online, Pawan Kumar Chandana, Co-founder & CEO of Skyroot Aerospace says: “A forward looking FDI policy is very important for the space sector which is capital intensive and a global market by nature. More FDI in-flow creates access to capital at par with global players making Indian companies more competitive and sustainable.”
“Considering the edge which India has in the commercial space, this will also make us an ideal geography for global investments growing both our technology and High-tech employment,” Chandana adds.
Also read: The private sector thrust to India’s global space leadership
FDI in Space Sector in India
So far the FDI in space sector is being allowed only for satellite establishment and to expedite the process investments will be allowed through automatic route and in majority of cases government approval will still be required.
Also read: The Indian century in space: The space sector in 2022 set stage for Indian dominance
In May 2020, the government announced opening up of the space sector to the private sector companies. The decision, as reported earlier by Financial Express Online had been pending for a while, as a few years ago a committee headed by aerospace scientist Dr A Sivathanu Pillai had submitted a report to Indian Space Research Organisation (ISRO). In that report he had proposed the opening up of the space sector to private players.
Currently India lags behind countries like the US, China as it accounts just around 2 percent as compared to the US$ 44 billion in the global space economy. In India the space sector has always been government controlled and the private players have only recently got an opportunity to work with ISRO and participate in different activities.
Also read: To infinity and beyond: Indian space startups lift off in style
In the recent years as reported earlier several space start-ups four companies including Agnikul, Skyroot, Dhruva and Pixxel have attracted foreign investments. Financial Express Online has reported that companies like Skyroot and Pixxel have set industry records for the highest foreign investment at US$ 51 million and US$ 25 million.
https://www.financialexpress.com/business/defence-india-soon-going-to-allow-100-fdi-in-space-sector-is-this-good-or-bad-read-to-know-more-3106572/
