Privatise Isro

[Answered] India has contributed tremendously in
space exploration. Do you think India should expand

private players role in its space industry? Critically
analyse.
blog.forumias.com/answered-india-has-contributed-tremendously-in-space-exploration-do-you-think-india-
should-expand-private-players-role-in-its-space-industry-critically-analyse/
Written by: ForumIAS
Demand of the question

Introduction. Write a contextual introduction.
Body. Need of privatisation of space. Benefits, and
issues.
Conclusion. Way forward.
India is among the global leaders in space exploration. ISRO has spearheaded India’s
success in space. From a modest beginning in the 1960s, India’s space programme has
grown steadily, achieving significant milestones. These include various satellite launch,
space-launch vehicles, and a range of associated capabilities. But private sector has not
contribute much to it.
Why private sector should be involved in space industry?

1. Increasing Demand- Indian Space Research Organisation (ISRO)’s annual
budget has crossed ₹10,000 crore ($1.45 billion) and is growing steadily.
However, demand for space-based services in India is far greater than what
ISRO can provide. With limited number of staff, its difficult to meet the ever
increasing demand from various stakeholders. Therefore, private sector
investment is critical, for which a suitable policy environment needs to be created.
2. Overall growth of space sector- Private sector participation is needed to
ensure overall growth of the space sector. ISRO has a strong association with the
industry, particularly with Public Sector Undertakings (PSUs) like Hindustan
Aeronautics Limited and large private sector entities like Larsen and Toubro. But
most of the private sector players are Tier-2/Tier-3 vendors, providing
components and services. The Assembly, Integration and Testing (AIT) role is
restricted to ISRO. Role of private industries should be increased.
3. Very less global contribution- The global space industry is estimated to be
$350 billion and is likely to exceed $550 billion by 2025. Despite ISRO’s
capabilities, India’s share is estimated at $7 billion (just 2% of the global market).
Private sector role is must to increase India’s contributions globally.
1/3
4. International trends and experience– Elon Musk’s “SpaceX” and its high
profile projects have highlighted the increasing significance of the private players
in the space sector. In India, despite the various strategic, security and regulatory
constrains, a limited private ecosystem has evolved around the ISRO. Private are
merely contracting with national space agencies to build satellites and subsystems.
Contrarily, the current trend is developing entire vertically integrated operations
without licensing or purchase agreements with national agencies.
Various Benefits of private sector’s participation in space industry

1. Greater pool of resources- Public resources- land, labour, capital are limited.
Private sector participation will open new pool of resources and talent. It will
bring more funding, and experience into space exploration activities.
2. Human Capital- Restricting space activities to ISRO, limits proper utilisation of
talent all over the country. With demographic dividend, private sector
participation can exploit the talent across the nation contributing a lot to space
explorations in India.
3. More time for ISRO- Today every space mission is done by ISRO, whether its
communication satellite or any weather monitoring satellite. With increased role
of private player, ISRO can concentrate more on its pathbreaking innovations like
Reusable PSLVs, Cryogenic rockets, mars inhabitation.
4. Technological advancement– Commercialisation will also develop better
technologies which is important. It will allow integration of many other
technologies like artificial intelligence into space exploration activities. With
experience from space activities, private sector can increase role of technology in
other areas.
5. Risk Sharing- Every launch consists Risk. Privatising helps in sharing the risk of
cost factor. Failure costs will be distributed. Also with increased private
participation, failures will reduce due to increased available human capital and
mind. Joint venture brings the knowledge from various stakeholders minimises
failures and increases productivity.
6. Commercial demand- There is need to enhance internet connectivity for the
masses, which is another demand pull factor for increased commercial interest in
space. Asteroid mining is also another potential area that looks promising, with
scope for monetisation and disrupting commodity markets.
Issues and Concerns of private participation in space industry

1. Data Risk– Though space it gives an opportunity to entrepreneurs but raw data
of ISRO in the hands of public is sensitive and consists of danger of misuse or
improper utilisation of data.
2. Regulation- Though its a profitable investment, regulation of private sector
participation is not easy. The time taken for regulatory clearances and unstable
political institutions can cause delays and hurdle in decision making of investors.
2/3
3. Revenue loss– ISRO will loose a fair amount of money it is earning through its
space activities. This will reduce government revenue.
4. Unfair commercial practices– Allowing private sector may lead to lobbying
and unfair means to get space projects or launch of any satellite for their own
profit. It may also lead to leakage of sensitive information by private players to
other countries and companies to make profit.
India should create an independent body that can create a level playing field for
government and private space enterprises. A new Space law for India should be framed
which should aim at facilitating growing India’s share of global space economy to 10%
within a decade which requires a new kind of partnership between ISRO, the
established private sector and the New Space entrepreneurs.
3/3

Privatise Isro

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Privatise Isro

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[Answered] India has contributed tremendously in

space exploration. Do you think India should expand

Written by: ForumIAS

Demand of the question

Why private sector should be involved in space industry?

Various Benefits of private sector’s participation in space industry

Issues and Concerns of private participation in space industry

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