Space FDI won’t be near-term booster, but long-term prospects bullish

livemint.com:

India’s decision to allow up to 100% foreign direct investment (FDI) in space companies will help the industry in the long run, even though it may not offer an immediate boost, industry veterans and stakeholders said. Late on 21 February, the Union cabinet approved a new FDI policy for the space sector, which will allow FDI ranging from 49-100% in different areas.

The move is expected to give space funding a big boost. “In just three years from 2021, the global space sector has raised $37.1 billion in investments," Pawan Goenka, chairman of the central government’s nodal space body, Indian National Space Promotion and Authorization Centre (In-Space), said.

“The easing of FDI will enable Indian space start-ups working on capital-intensive products to access this global pool of capital, in order to expand manufacturing and production capacities." The new policy for the space industry, a nascent field that was only privatized in 2020, will allow up to 49% automatic foreign investments—without needing government approvals—in space launch vehicles (or rockets), and building of space-port solutions for launching and landing rockets. Automatic foreign investments of up to 74% for equity stake in companies will be allowed in satellite manufacturing and operation ventures, including those that offer satellite-based data solutions.

And 100% automatic FDI has been allowed in space ventures working on component manufacturing for the satellites industry. India’s space startups, who stand to gain from the new policy, are over the moon.