Space, the final private sector frontier

It is unfortunate that Isro has had to calm nerves over India's efforts to allow commercial exploitation of the space sector. The clarification followed an Isro Staff Association appeal for assurances about the agency's future role, after comments that it would no longer manufacture launch vehicles. Space exploration is no longer the exclusive preserve of state agencies, and India has adopted policies to promote tech transfer from Isro to the private sector through IN-SPACe. Consortiums of Indian companies are producing parts of Isro's PSLV as well as rockets to place small satellites in orbit. Isro will continue to maintain India's position as one of the world's leading space-faring nations.

But the space race has become commercial, and India risks losing its advantage unless it develops a robust commercial ecosystem. Space exploration is now being driven with resource extraction in mind, and most countries have brought on board private industry to do the heavy lifting. Unless India Inc develops the capability to build and launch satellites, it will trail in segments like telecom fed through low-Earth-orbit (LEO) satellites. Most of this tech is dual-use, and Isro remains a key source for companies venturing into this sector. It is best placed to filter out the strategic technology elements from commercial advances that are taking place across the world.

The same approach is guiding India's push into nuclear energy and local defence production. The private sector has a bigger role to play in space, nuclear energy and defence production than it was expected to for much of India's post-liberalisation economic history. This is a welcome departure in policy and places a big burden of expectations on Indian companies. Since these sectors are restricted, domestic industry stands to benefit from implicit protection. Government agencies such as Isro will remain at the research frontline while manufacturing is passed on to private players. This is how it is being done the world over. India cannot remain an exception indefinitely.