Govt. notifies liberalised
FDI norms for space sector to boost investment
The
government has notified amendments to the foreign direct investment policy in
the space sector to attract offshore investors in satellite manufacturing and
satellite launch vehicles segments.
Amendment
made in the FDI policy for space sector through a gazette notification dated April
16, 2024, prescribes liberalized entry route and provides clarity for FDI in
satellites, launch vehicles and associated systems or subsystems, creation of
spaceports for launching and receiving Spacecraft and manufacturing of
space-related components and systems.
"These
rules may be called the Foreign Exchange Management (Non-debt Instruments)
(Third Amendment) Rules, 2024," the gazette notification said.
The
liberalized entry routes under the amended policy are aimed at attracting
potential investors in the Indian companies in space.
The
Union Cabinet earlier this year gave approval to these amendments.
The
notification comes days ahead of the scheduled visit of Tesla CEO Elon Musk who
is expected to meet with various Indian space companies during his visit from
April 21 to 22.
Concurrently,
approvals for Musk's satellite internet project, Starlink, are nearing
finalization.
As
per the notification, up to 74 per cent FDI for satellite manufacturing &
operation, satellite data products and ground segment & user segment are
allowed under automatic route. Beyond 74 per cent these activities are under
government route.
FDI
up to 49 per cent is allowed for Launch Vehicles and associated systems or
subsystems, Creation of Spaceports for launching and receiving Spacecraft are
under automatic route but beyond 49 per cent government permission would be
required.
Besides,
100 per cent FDI allowed for manufacturing of components and systems/
sub-systems for satellites, ground segment and user segment without government
permission.
As
per the earlier norms, FDI was permitted in establishment and operation of
Satellites through the government approval route only.
In
line with the vision and strategy under the Indian Space Policy 2023, the Union
Cabinet has eased the FDI policy in the Space sector by prescribing liberalized
FDI thresholds for various sub-sectors/activities.
The
Department of Space consulted with internal stakeholders like IN-SPACe, ISRO
and NSIL as well as several industrial stakeholders. NGEs have developed
capabilities and expertise in the areas of satellites and launch vehicles. With
increased investment, they would be able to achieve sophistication of products,
global scale of operations and enhanced share of the global space economy.
www.business-standard.com
dt. 18.04.2024