Budget 2023: Space tech industry seeks more allocation for IN-Space, Defence Space Agency

Image: Twitter/@isro

Space tech startups are hoping for a larger allocation in the upcoming Union Budget 2023 for the Indian National Space Promotion and Authorisation Centre (IN-Space), the government's one-stop body for all dealings with private space industry players.

This allocation will help non-governmental entities (private sector players) with common-testing facilities and other infrastructural needs that IN-Space provides.

"As a private company our wish is a good sum as budget for IN-Space. This would prove beneficial in preparing the industry in a big way with the help of common testing facilities and other infrastructure needed," Skyroot Aerospace co-founder Pawan Kumar Chandana said.

Similarly, Kranthi Chand, Head - Strategy and Special Projects at Dhruva Space, noted that IN-Space was allocated Rs 33 crore in last year's budget.

"As per our understanding, the Centre has constantly supported both technology and business development across the space sector. In Union Budget 2023-24, we request a further Rs 100 crore issuance as viability gap funding (VGP) to set up new infrastructure," Chand said.

Viability Gap Funding (VGF) is intended to provide capital support to public-private partnership (PPP) projects that would not be financially viable otherwise.

IN-Space has become a significant contributor to the industry in the short time that it has been operational. It has emerged as a focal point for easing communication, integration, and permission-related complexities between government and private-sector players.

According to an Indian Space Research Organisation (ISRO) report, IN-Space has received more than 150 proposals for future consideration from start-ups, MSMEs, and industries.

Defence-related allocation

Chand also mentioned permissions granted by the Ministry of Defence and Service Headquarters for a number of satellite and space technology projects.

"Over and above, we request dedicated allocation for the Defence Space Agency (DSA) of Rs 1,000 crores for the procurement of new technology from the industry which serves as technology enabler, and for demonstration of new technologies," he said.

The Defence Space Agency is a tri-service agency of the Indian Armed Forces that is in charge of the country's space warfare and satellite intelligence assets.

"If macro-economic level growth is complemented with a focus on micro-economic level, the budget will give a boost to the overall space-technology ecosystem; particularly to the private start-ups and MSMEs in the space sector who are working towards further establishing India as a space nation," Chand added.

Pixxel in a statement said, "In the 2023-24 Union Budget, we’re hoping to see larger dedicated allocations than last year for IN-Space and Defense Space Agency. This will help not only with common testing facilities, procurement of new technology, demonstration and setting up the needed infrastructure, but also in reinstating the government’s faith in space tech startups to establish India as a space nation."

Increase in R&D spending

Apurwa Masook, CEO, SpaceFields said that there was a need for increasing research and development spending.

"We hope the Budget 2023 would focus on increasing R&D Spending as well as allocating procurements and pilots to Startups. Governments such as UAE, Australia, Singapore, and many more have moved to infuse substantial capital."

"Young startups need serious capital to accelerate the pace of innovation, as typical investors continue to be risk-averse. With, government as a major anchor, this ecosystem can be a formidable force to augment critical capabilities of the nation in both upstream and downstream segments," Masook added.

Production-linked incentive

Pixxel in a statement to Moneycontrol also requested for production-linked incentive for the space sector.

"We would also like to request the introduction of a space-based Production Linked Incentive Scheme (PLI) for space tech startups to boost local manufacturing and encourage capability building within the country.
Moreover, enabling an easy FDI process will be key to weathering the current economic and investment downturn and emerging out the other side with continued investment and support from global investors," the start-up said.

Moneycontrol has reached out to other space-tech startups, including Agnikul Cosmos, Astrogate, GalaxEye, and others, and the copy will be updated as soon as a response is received.