The Foreign Direct Investment (FDI) amendment policy on the Space Sector has been approved by the Prime Minister Mr. Narendra Modi. Now, the satellites sub-sector has been divided into three different activities with defined limits for foreign investment in each such sector. As per the existing FDI policy, FDI is permitted in establishment and operation of Satellites through the Government approval route only. The liberalized entry routes under the policy are aimed to attract potential investors to invest in Indian companies in space.

The Indian Space Policy 2023 was notified as an overarching, composite and dynamic framework to implement the vision for unlocking India’s potential in Space sector through enhanced private participation. The FDI policy aims to augment space capabilities; develop a flourishing commercial presence in space; use space as a driver of technology development and derived benefits in allied areas; pursue international relations and create an ecosystem for effective implementation of space applications among all stakeholders.

The space sector has been liberalized for Foreign Direct Investment policy by providing clarity for FDI in satelites, launch vehicles and associated systems/subsystems. The entry route for the various activities under the amended policy are as follows:

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Upto 74% under Automatic route: Satellites-Manufacturing & Operation, Satellite Data Products and Ground Segment & User Segment. Beyond 74% of these activities are under government route.

Upto 49% under Automatic route: Launch Vehicles and associated systems or subsystems, Creation of Spaceports for launching and receiving Spacecraft. Beyond 49% of these activities are under government route.

Upto 100% under Automatic route: Manufacturing of components and systems/ sub-systems for satellites, ground segment and user segment.

With this, companies will be able to set up their manufacturing facilities within the country, duly encouraging ‘Make In India (MII)’ and ‘Atmanirbhar Bharat’ initiatives of the Government.