Why Do We Care So Much About India’s Space Sector? I have written extensively on the expansion of India’s space sector, contributing to publications like Policy Circle and international journals such as SpaceWatch. I have also had the privilege of engaging with space entrepreneurs in both India and the US, and I have formed a close friendship with one of the most passionate advocates of the space sector worldwide, Shelli Brunswick, former Chief Operating Officer of the Space Foundation.
In her many lectures and writings, Shelli often poignantly states that we are already living in a space economy. Yet, whenever I find myself in a discussion about space, one recurring question comes to mind: Why is India so determined to promote its space sector?
India was a relatively late entrant in the global space race, and the average person — an active participant in the economy — often lacks a clear understanding of why the space sector is crucial. Without this broader public comprehension, policymakers may struggle to develop policies that genuinely support the sector’s growth. The risk is that India’s space industry could see rapid initial expansion but soon hit an upper ceiling—a common fate for emerging sectors in developing nations.
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India’s space sector: On an episodic growth path
Dani Rodrik’s work on structural transformation (Structural Change, Fundamentals, and Growth: An Overview, 2013) offers a critical framework for understanding the potential trajectory of India’s space sector. Rodrik identifies two main challenges for developing countries aiming for sustainable economic growth: the structural transformation challenge and the fundamentals challenge. The distinction between these two can be confusing, as both are crucial for long-term growth. Structural transformation involves shifting resources to high-productivity sectors, while the fundamentals challenge focuses on building strong economic foundations, such as institutions and innovation.
Rodrik explains the difference this way: “In practice, it may be far easier to promote industrialisation directly, by subsidising industry or removing specific obstacles, than to do so indirectly by making broad investments in human capital and institutions, hoping these will trickle down to industrial investment incentives. It is possible to have rapid structural transformation (industrialisation) without commensurate improvements in fundamentals. East Asia is a prime example of this strategy. In China, governance and human capital have lagged behind the country’s manufacturing prowess.”
Rodrik argues that accumulating fundamentals requires costly, time-consuming investments across the entire economy. This is precisely where India needs to focus its efforts.
However, he cautions: “It is also possible to invest significantly in fundamentals without seeing much reward in terms of structural transformation. Since the early 1990s, Latin America has considerably improved its governance and macroeconomic fundamentals, yet structural change in the region has been, if anything, growth-reducing. Manufacturing and other modern sectors have lost employment to lower-productivity services and informal activities.” This highlights the importance of balancing structural change with investments in fundamentals for India.
Currently, India’s space sector fits into Rodrik’s quadrant of high structural transformation but low fundamentals—a scenario of episodic growth. The sector has achieved rapid expansion, with notable achievements like the Mars Orbiter Mission (Mangalyaan) and Chandrayaan, driven by strong government support and cost advantages. However, it lacks the robust fundamentals necessary for sustained growth, such as a fully developed innovation ecosystem, significant private-sector participation, and extensive R&D investment.
Rodrik’s work suggests that in the early stages, growth is driven by rapid industrialisation (i.e., structural transformation), requiring policies distinct from those focused on traditional fundamentals. Countries that concentrate solely on broad-based capabilities may experience limited growth, missing out on the targeted industrial strategies needed for initial acceleration.
Technology is never just technology
In a recent article on Policy Circle, Aqib Chaudhary and Ram Singh rightly argue that India must focus on building domestic capabilities to grow the space sector. As Peter J. Katzenstein explains in The Culture of National Security, technology is not just about technical progress; it is deeply intertwined with societal values, goals, and concerns. For example, the development of nuclear weapons during the Cold War was as much about political deterrence as it was about achieving a specific technical capability.
What specific objectives do we need our space sector to achieve? This is something we must define and communicate. So far, national pride and showcasing our low-cost technological capabilities have been clearly articulated goals. However, if we want the space sector to contribute meaningfully to industries like agriculture, we need to begin tracking and publishing data on its contributions. Annual data, roadmaps, and assessments of progress and gaps will help provide clearer direction.
Public perception of the space industry
Positioning the space sector within our social context will allow us to learn from our mistakes and use the sector more effectively. Here is an observational analogy: In countries where domestic airlines are a new phenomenon, you often see passengers disregarding basic flight safety rules, like keeping their seat belts fastened. This behaviour reflects a lack of understanding about the risks and limitations of air travel—something that countries with a long history of commercial aviation have internalised through experience.
Similarly, India’s space industry is still in its infancy in terms of public understanding. We must go through this learning curve. Our approach to the space sector should not focus solely on rapid expansion but also on understanding its potential and limitations. Integrating space technologies thoughtfully into key sectors like agriculture, telecommunications, and disaster management will foster a deeper appreciation for their contributions to economic and social well-being. A broader societal engagement with the space industry will also help build a stronger base of public and policymaker support, crucial for long-term success.
It is important to understand that technology alone cannot solve all problems. As an Israeli technologist and diplomat once told me, countries stuck in the “middle-income trap” often think technology is the solution to all their issues. However, governance, not just technology, solves problems. Technology must serve governance, not the other way around. He recounted a trip to a village in Odisha where self-help groups managed community water taps with remarkable efficiency—an example of how the same technology can produce different outcomes depending on governance. This lesson applies to the space sector as well. Developing strong governance mechanisms is just as important as driving structural transformation.
Arpit Chaturvedi is the Co-Founder and Chief Executive Officer of Global Policy Insights (GPI), a centrist thinktank based out of New Delhi, New York, and London.