India’s aviation and aerospace startups have received $6.2 Mn in funding as per analysis by DataLabs by Inc42
The cost of space launches is reducing at 8% CAGR
Compared to 2018, India’s aviation and aerospace startups observed 182% growth in seed funding
India’s space and aviation programme has thus far been a government-backed effort with the Indian Space Research Organisation (ISRO) leading the way. But now that is changing, with the emergence of a clutch of space technology startups. Today, there are about 120 active startups in this field compared to only a handful before 2014. About 64% of space or aerospace startups has launched in or after 2014.
With a vision to harness space technology for national development while pursuing space science research and planetary exploration, the Indian National Committee for Space Research (INCOSPAR) was established under the Department of Atomic Energy (DAE) in 1962, INCOSPAR grew and became ISRO in 1969, also under the DAE. Since then ISRO has put India’s space research into the forefront of the world.
The success of ISRO has brought in a new wave of private companies and startups in the Indian market, and investors are paying attention, given the surge in global interest in everything from satellite imaging, drone surveillance, space exploration to space vacations. From propulsion and rocket technology ventures such as Bellatrix, to satellite makers such as Dhruva Space and Team Indus that aspire to bid for entire missions rather than supply piece-meal components, India’s aviation and aerospace startups are blooming. A few startups like Kawa Space, are even democratising space by providing space-as-a-service.
This new wave of space technology startups breaking off across India has been largely made possible due to a reduction in launch costs and ISRO’s continued effort to reduce the manufacturing and production cost of satellites.
When talking about satellites, the general perception is — thanks to Hollywood — of multimillion-dollar behemoths. But, things have changed, thanks to technology prototypes that are far more affordable and accessible. Today, small satellites can be built quickly and launched at a feasible cost.
Kawa’s Kris Nair thinks the time is right for space-tech startups.
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“Nearly all Indian space tech startups are looking at the global customer base. The good thing about this industry is the startup’s base doesn’t matter much — if you have a great solution with space pedigree, customers will want to get the product.”
Aviation and aerospace technology in the private and startup sector has opened up the market and broken through the government monopoly. While companies in the US and other countries have been exploring space applications and aerospace tech for decades, Indian startups were only given this impetus in the wake of the Startup India policy and the success of ISRO’s low-cost missions that grabbed the world’s attention.
Another area that startups are exploring vigorously in the Indian context are commercial use satellites for low-earth orbit applications — this is much closer to the earth’s atmosphere and easier to reach than the geostationary orbit where many communications satellites operate.
Here, small and cheaper satellites are snapping images used in everything from crop-monitoring and geology to defence and urban planning, bringing down costs and increasing the frequency of images. Major tech giants such as SpaceX are exploring beaming internet to remote areas from low-earth orbit.
And these new breed of startups and applications are also catching the investor’s eye.
However, there’s a yawning gap between space venture funding in India and abroad. Space startups raised a record $3.2 Bn in funding last year globally. It took off in 2015 and has crossed the $2 Bn mark every year since then. Globally, 80% of space venture funding last year was in the US, with China and the UK taking the lion’s share of the rest.
Understandably, manufacturing for the aerospace sector is a complex exercise for a number of reasons. It is capital-intensive, has high technological requirements and a prolonged gestation period. But, venture capital investors in India being lukewarm to space tech would not help India compete on a global level despite having a well-developed space programme. While the industry has come a long way, it is still evolving to overcome the challenges.
Apart from capital, there are also the systemic challenges manufacturers face in terms of the supply chain itself, and how tightly controlled space launches are. India’s drone industry faces similar issues. While, the government has released a revised drone policy, would it be enough to provide the required push to drone manufacturing and commercial use of drones? To find out, download the report here.