ISRO's small satellite launch vehicle (SSLV) is expected to open up the commercial space market. Credit: ISRO
A venture capital fund of 10 billion rupees (US$119 million) will be set up in line with India’s ambition to increase its space programme spending by five times in the next ten years. Laying out the country’s annual budget today, finance minister Nirmala Sitharaman announced that the fund would help bolster private sector investment in space research and innovation.
The National Democratic Alliance government’s first budget since its re-election this year also revealed a shift to diversify the country’s energy mix and a plan to invite private sector investment in nuclear energy research and development.
The research and start-up sectors welcomed announcements to strengthen the private sector’s role as also the long-awaited move to launch the Anusandhan National Research Fund (ANRF) for basic research.
“The space fund is a promising beginning, but sustaining momentum requires diverse investments, and nurturing innovation across the spectrum of risk,” said Anirudh Sharma, Chief Executive Officer of the Bengaluru-based space tech start-up, Digantara.
The country’s space regulator, Indian Space Promotion and Authorisation Centre (IN-SPACe) estimates a $44 billion space economy for India by 2033 — about 8% of the global share, up from 2% now. The Economic Survey 2023-24, tabled a day ahead of the budget, noted that India has 55 active satellites. Earlier this year, the government allowed 100% foreign direct investment in satellite systems manufacture as the number of space startups rose to nearly 200 in 2024 from just one in 2022.
Sitharaman unveiled the government’s plans to collaborate with the private sector to establish Bharat Small Reactors, which will develop small modular reactors, which have a third of the generating capacity of traditional ones, but produce a large amount of low-carbon electricity. This would require legislative changes to the Atomic Energy Act, according to Saurabh Todi, a technology analyst at the thinktank The Takshashila Institution.
Karishma Kaushik, Executive Director of IndiaBioscience said ANRF must balance both “directed-research” and “blue-sky exploration” in its push for private-sector involvement.
“ANRF fundraising from private and philanthropic entities will be a mega-experiment for science in India, historically funded by government programmes,” she said.
Critical tax measures, job growth incentives, and a strong focus on skilling, if effectively implemented, can empower India's youth and drive economic growth, said V Ramgopal Rao, Vice-Chancellor of Birla Institute of Technology and Science. “The budget could have allocated more resources towards academic research partnerships,” he added.
Sitharaman outlined a raft of measures to strengthen energy transitions, including the completion of advanced ultra-supercritical thermal power plants with reduced emissions. The country will also review agriculture research set up to steer focus on increasing productivity and developing climate resilient crop varieties.
Arunabha Ghosh, CEO of the Council on Energy, Environment and Water (CEEW) said policies around clean energy markets and green industry will benefit from a focus on preventing losses from climate events, promoting new business models for households and small industry, a circular economy, and innovative financing beyond budgetary support. “In that regard, the budget’s proposal to define climate finance is a positive step towards mobilizing capital for sustainability,” he added.
