Chairperson of In-Space, Pawan Goenka spoke to The Sunday Guardian.
Indian National Space Promotion Authorization Centre (In-Space) to have its own infrastructure and experts to handhold private sector initiatives in space sector, said Pawan Goenka chairperson of the sectoral regulator for private players. Excerpts from an extensive conversation with Goenka:
Q: What has made the government so focused on space?
A: If you look at the overall space sector globally it is about a USD 414 billion sector and India is just about USD 8-10 billion which is just about 2 per cent of the global space sector despite the fact that India is amongst the top few nations in space technology and space infrastructure and one of the six or seven space trading nations which have full end to end space technology and expertise. So clearly the space sector has been under leveraged in India. This is what the Government in India realised sometime in 2019-20 that they need to look at space differently from the viewpoint of how it can add value to the economy and how it can possibly help in the day-to-day life by taking advantage of the earth observation data that we already have and that we can get. Besides the space economy was dominated by ISRO and was, therefore, all government driven in terms of support and use except for the communication satellites which where the private sector was present as user. But the space sector was not contributing directly to furthering the space technology, infra and space objects. That is the reason, I guess, the Government looked around at the countries that have the highest contribution of space in terms of market share and share of the economy are those where the private sector plays a major role in the space economy—whether it be the USA, Korea, Japan and the European nations—and government plays an enabling role. Similarly the NASA does not play the role it used to 30 or 40 years back and plays only an enabling role with the help of companies like SpaceX. That is the background to why India opened up the space to the private sector in June 2020.
Q: Why are private companies so attracted by the space sector?
A: Looking at how the start-ups have done in other countries in this domain, Indian start-ups also realised that there is an opportunity to create a valuable business proposition in space sector. With the Government inviting private participation, a large number of space start-ups have been launched in the last two years and a half. At the same time, digital industry players who until 2020 played the role of a vendor to ISRO and made parts for it, also started looking at technology of space and how it can play a higher value addition game in space. So big players like L&T, Godrej are also looking at space differently and putting in more resources and investments. Thus In-Space has come in timely as the nodal space agency for private sector. India is the only country to the best of our knowledge where a nodal agency has been created to regulate and promote private sector in space, often that role is given to a state agency, here it has been separated from the agency which does the job of infrastructure and facilitation and so forth.
Q: What’s the role of In-Space?
A: Just opening up the space sector was not enough. The Government had to put the pieces in place. That was when In-Space was created to promote, enable and facilitate the private sector to come into the domain and also to regulate. Thus when the private sector come in with multiple players, there has to be a regulator to ensure we do not compromise on safety, security and the international commitments that India has in space. Hence, In-Space was established with the double mandate of a regulator and promoter.
The proposals that are coming now are for approval and authorisation and for facilitating their work which means that an entity has developed something which cannot completed without the help of ISRO which has the testing infrastructure that the company needs or a special expertise. They approach In-Space for help. Right now about 85 per cent of the applications are of this type where they have not yet reached the point of requiring approval. Only about 15 per cent or so are for getting approval. In-Space currently does not have its own infrastructure but taps into ISRO infrastructure and facilitates the private sector to use this facility and get access to ISRO experts.
However, in the next few months In-Space will start having its own infrastructure in some areas which will be of routine and frequent use for the private sector and we will have experts who will do handholding of private sector. The first set of infrastructures will be ready in around the second and third quarter of the next financial year and will be located in Ahmedabad. We are also working to identify opportunities for the private sector to work on and will also try to do a little bit of seed funding. We are in the process of identifying the areas in which the private sector will have technical and commercial feasibility and then work with the companies towards guiding them and leading them into those activities.
Five space projects have been cleared so far which are in the approval part. There are 21 Memoranda of Understanding which have been signed and hence there are at least 16 more which don’t require approval. These are more of facilitation.
Q: Are you witnessing a sizeable growth in private role in space since taking over?
A: Whatever is happening is because the opportunity was created and supported by the overall environment. Calendar year, 2022, has been, by far, the best year for funding. The total investment that has come in is USD 110 million and that is not counting the investments that large companies may have done themselves for their space vertical. This is the investment done by VCs and PEs in the Indian space start-ups. The USD 110 million, in perspective, represents about 8 per cent of the ISRO’s Budget and so that is not a small amount. The highest valuation in India—in our knowledge—of a start-up in the space sector is about USD 200 million. When these start-ups start showing outcome their valuation will multiply like it happens in all other start-ups and I would say that about half a dozen start-ups have reached a point where they have something to show. I would assume, that when their output goes to the next phase, that USD 110 million figure will go up significantly in 2023-24.
Q: What are the new opportunities for space start-ups?
A: In India ISRO has tremendous expertise in taking, what is known as earth observation data. That is the actual data taken from earth by transmitting data to the satellite or by taking photographs from the satellite and analysing the photographs. Almost all the data developed in India has been by ISRO and so they have a wealth of data from which they have developed hundreds of algorithms. This involves drawing the data and deriving meaningful conclusions from it whether that relates to agriculture or weather forecasting, disaster management, fishing, urban planning. They have done all that. But ISRO does not go to the civil society. They will go to government departments who take the responsibility and take it to the masses. If the private sector came in, they will directly go to the masses because they will develop certain algorithms, for instance, one which can be used to discover how to get better outcome in fishing.
Q: What are your challenges?
A: Of course there are challenges. There are the following four things. First is the skill in the space sector is concentrated with ISRO but the agency has hundreds of retired experts who are active and can make huge contribution to the private sector. The private sector is beginning to tap into this expertise which can handhold them. The second is money because space is a capital intensive sector and while start-ups can obviously do some bootstrapping, after a point they will take serious funding. Third, space has a long gestation period hence people will have to have patience. There is no instant gratification. It will take time.
The good thing is that there is a lot of interest from startups and they always amaze me in what they can do with limited resources. I am very optimistic. Government is on the right track, having officially designated space as a sunrise sector, and going by the number of start-ups which are coming up, the kind of investments that are coming in the space sector by VCs. Clearly there is tremendous opportunity and tremendous thrust by the government.