Building India’s space supply chain:

Building India’s space supply chain: The multibillion-dollar opportunity for SpaceTech Startups

India’s space economy has been undergoing a shift since the Space Policy came into effect in 2023. For the first time in history, space exploration has been made open for pvt companies to participate. Along with it, the budgetary support and availability of pvt capital have made India a global hub for space tech innovation.
IN-SPACe, which is an autonomous agency set up under the Department of Space (DoS), has set ambitious goals of $44 Billion space economy for India by 2033, which is a significant jump from where it is today, roughly $10-12B.

As per CII, EY, and FICCI reports, the $44B goal relies on four major pillars.

• Satellite Services (60%): EO analytics, SatCom broadband, NavIC PNT apps integrated into Gati Shakti/Ayushman Bharat.
• R&D/Upstream (5%): ISRO tech transfer, GagaGaganyaanares, commercial launches by NSIL.
• Ground Segment/Manufacturing (15%): User terminals, antennas, PLI for components.
• R&D/Upstream (5%): ISRO tech transfer, Gaganyaan/BAS precursors.

The Rise of India’s 500+ SpaceTech Startups

Since the Space Policy came in, India’s spacetech startups have surged in numbers. There are more than 500 spacetech startup today, and enthusiastic space entrepreneurs are working on interesting problem statements ranging from rocket engines, launch vehicles, satellite systems, various subsystem electronics sensors, and payloads.

While these are significant progress as indigenous capabilities in these areas are critical, it is important to note that the bulk of India’s $44B space economy is expected to come from the downstream data and communication applications, where lie the biggest opportunities for the startups in India.

As the imaging technology has improved multifold, satellite imageries have become an essential ingredient to analyse the surface of the earth.

Why the Real Opportunity Lies in Downstream Applications

Today, satellites are capable of taking high-resolution imagery using hyperspectral cameras and overlaying it with images taken by other sensors, whether infrared (IR) or synthetic aperture radar (SAR) or normal optical sensor cameras, to create a more meaningful interpretation of the satellite data. This has a wide range of applications, starting from defence, to disaster management, to agriculture, mining, and other industrial sectors.

Defence is using satellite data as a strategic tool to monitor land and sea. Through AI and ML, it is possible to identify and classify any object, its movement, and direction, along with specific details such as its country of origin, whether it's civilian or military, and the type of instruments they carry. Until very recently, India had to depend on other countries to purchase such imageries and insights, but the good news is that Indian startups are making fast progress to build similar capabilities.

Another area to focus on is the data latency. These satellites are rotating the earth at low earth orbit (LEO), and there is an inherent time gap when a satellite is able to take images of a particular point on earth, which goes up to a few days. Another factor is the latency in relaying the data back to earth, which is possible only for a few minutes in a day when the satellite is able to establish a connection with the earth's ground station.

Building a Cohesive Ecosystem: The Next Phase of India’s Space Supply Chain

To overcome both challenges, India needs to put a far greater number of satellites on the orbit. To draw a comparison, India has more than 50 satellites in orbit, whereas China has close to 1,000, and the USA has almost 10,000. That gives these countries a unique ability to see across the earth's surface and relay the data back to the ground station in near real time. This is a huge strategic advantage for a country and hence India is actively working towards that as well. In fact, India has ambitious goals to reach a 50 launches a year target by 2030 from 5 launches a year as of today, and pvt players, including startups, are going to play a crucial role in achieving this.
India’s spacetech ecosystem is evolving rapidly across the value chain. The sector’s institutional and regulatory efforts are increasingly aligned toward building a cohesive environment that enables private participation and sustained innovation. While the current focus of spacetech founders is on building the rocket engines and launch systems, more founders should start looking into the data and communication aspect seriously, as it not only has huge potential business opportunities, but also gives the necessary strategic advantage to our country in the near future.