New space law draft ready, to open for consultations by March

A fresh draft of India’s first dedicated space law is ready, said Pawan Goenka, chairman of nodal space regulator Indian National Space Promotions and Authorization Centre (In-Space), a move that could make foreign investments easier in the nascent sector.

The absence of a space law has hobbled investments into the industry, crimping its ability to grow beyond the current estimated $9 billion. Investment applications currently need to go through the tiny space department, causing a backlog.

The new draft comes six years after the government came out with the first one. All that India has at the moment in the form of an official document is a four-page policy published in 2023.

The latest draft, prepared by the Department of Space, is expected to be thrown open for industry stakeholder consultations by March next year, Goenka said in an interaction with Mint on Wednesday.

“The new draft is completely different from what an initial version prepared six years ago had laid out. This new comprehensive law will open up for industry stakeholder consultations by March next year, if not by the end of this year itself. Further to the consultation process, the law will then undergo requisite changes, and be submitted for approval with the minister of state for space—before being tabled in Parliament,” Goenka said.

However, the official did not offer a timeline for when the law might be notified, pointing out that the lawmaking process may undergo multiple iterations and discussions, as per the norm.

Once notified, it is expected to give legal powers to In-Space, which remains a regulatory body in appointment by the Centre, but without punitive powers for the time being.

Industry stakeholders said the law has been needed for a while now, and could play a crucial role in order for India to meet its target of generating $44 billion from the industry by 2033, as per In-Space.

“India’s space policy, published last year, was an ‘intent document’. The space law being framed will be more comprehensive in terms of defining clear roles of the Indian Space Research Organisation (Isro) as a scientific organization, and the Department of Space as a ministerial body. This can help clearly define which body should handle foreign investment paperwork, regulatory conflicts and the overall commercial space economy of India—which currently remains missing from India’s space industry,” said Anupam Shukla, partner at law firm Pioneer Legal.

However, Shukla cautioned about taking a prudent approach to framing the law in fear of over-regulating a nascent sector. “The US still doesn’t have any dedicated law just for the space industry—this may raise the question of whether such a regulatory approach is even required,” he added.

Also in the works, Goenka added, is a framework for the ₹1,000 crore venture capital fund for space startups, along with appointing a “professional fund manager.”

“More details on the fund, including how it will work and become operational, is likely to take place by the first quarter of FY26,” the executive said.

Goenka remained confident about achieving the $44 billion valuation target he has set for India’s space economy in the In-Space decadal vision outline published last year.

“Most of this demand is expected to be generated from outside India, which is why a concerted push to promote the industry is further required. We’re already seeing multiple startups cater to various areas of the space industry, including small satellite and small rocket manufacturing, space applications, situational awareness, high-resolution space imaging, and more. If you would have asked me when I took on this role as to if we would have achieved everything that we have in the space domain so far, I wouldn’t have been able to tell you most of it,” he said.

The domestic space industry is also on track to seeing up to 40 rocket launches taking place from Indian soil in the immediate future, Goenka said.

“We’re expecting up to 12 launches from Isro in one year. Subsequently, we have a privatized Small Satellite Launch Vehicle (SSLV), as well as the two startups, Agnikul Cosmos and Skyroot Aerospace, which can generate a cumulative total of 25 launches per year. By the end of this decade, we should see 35-40 rocket launches per year taking everything into account.” Livemint