NEW DELHI: The government will set up a Rs 1,000-crore venture capital fund to promote space technology, Finance Minister Nirmala Sitharaman announced on Tuesday, in an announcement that was warmly welcomed by the industry.
Several officials, including heads of the Indian Space Association (ISpA), Indian National Space Propulsion and Authorisation Centre (IN-SPACe) and Pixel Space, said the provisions announced in the 2024-25 budget will boost growth and development in the sector.
Presenting the Union Budget in the Lower House, Sitharaman said the focus remains on expanding the space economy fivefold over the next decade and that she would set up a Rs 1,000 crore venture capital fund.
The announcement of the Rs 1,000 crore Focused Venture Fund will provide a major boost to new entrepreneurs and Non-Governmental Organisations (NGEs) in the space sector, according to IN-SPACe Chairman Pawan Goenka. He said INSPACe looks forward to supporting the growth of the space economy and fostering an enabling ecosystem for NGEs.
Goenka told PTI that the fund, along with existing policies in the space sector, will spur innovation and create fertile ground for NGEs to flourish. Awais Ahmed, CEO of Bengaluru-based startup Pixel Space, said the venture capital fund will provide critical financial backing to innovative startups and companies, enabling them to scale their technology and contribute to India’s space ambitions.
“Such a large investment underlines the government’s commitment to foster a strong and dynamic space ecosystem,” Ahmed told PTI. Chennai-based start-up Agnikul Cosmos added that the venture capital fund will help larger companies emerge from India’s start-up ecosystem. “It’s great news for all of us in the sector…It also shows that the government continues to strongly support its vision of making India a bigger part of the global space economy,” Agnikul Cosmos CEO Srinath Ravichandran said.
KaleidEO Chief Operating Officer Arpan Sahoo said the VC fund will address a critical funding gap in early space research and development and that the initiative will be transformative in building national capacity, fostering local IP creation and driving innovation.Industry body Indian Space Society said the move demonstrates the government’s commitment to the space sector.
The announcement of the Rs 1,000 crore venture capital fund is a step towards addressing the funding challenges faced by startups in this capital-intensive sector, said ISpiA Chief Executive A K Bhatt (retd.). Setting up 12 industrial parks across India will also provide a major boost to the space and satellite manufacturing industry, which has long been clamoring for the setting up of space parks.
These steps are crucial for the growth and development of India’s space ecosystem, Bhatt said. “The announcement of a Rs 1,000 crore venture capital fund for the space sector is a laudable initiative that will significantly boost innovation and growth in this vital industry. Every rupee invested promises significant returns as the space sector has immense potential to contribute to GDP growth and strengthen national infrastructure,” said Anil Prakash, executive director, Indian Satellite and Communications Industry Association.
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