New Delhi, Jan 19 (NationPress) The recently introduced Space Policy 2023 has opened doors for private sector engagement, but the crucial next step involves enhancing fiscal, regulatory, and structural support to propel growth and establish India as one of the leading spacefaring nations, according to the Indian Space Association (ISpA) on Monday.

The Association has also presented significant recommendations for the private space sector for government evaluation, aimed at bolstering domestic manufacturing, strengthening national security, generating high-value employment opportunities, and enhancing global competitiveness while ensuring secure and controlled access to strategic satellite and geospatial data.

It emphasized the necessity of recognizing the space sector as 'critical infrastructure' to unlock scale, attract private investments, and boost global competitiveness.

“Space infrastructure is foundational for telecommunications, defense, navigation, finance, weather forecasting, disaster management, and governance. A formal acknowledgment will facilitate infrastructure-grade financing, lower the cost of capital by 2-3%, and fortify national resilience,” ISpA stated.

While Indian private entities now showcase validated capabilities in satellites, launch systems, and ground infrastructure, the absence of guaranteed government demand limits scalability. ISpA urged for a formal procurement mandate to support industry growth while allowing ISRO to concentrate on strategic and exploratory missions.

The Association proposed that at least 50% of all government procurement for space-related services, hardware, and missions be acquired from Indian private entities (NGEs).

ISpA also suggested implementing PLI schemes for satellites, launch vehicles, space-grade components, and crucial subsystems; offering a five-year tax exemption for space manufacturing, launch services, and space-based service providers; and granting R&D tax credits of 20-30% for qualifying space-sector R&D efforts.

Moreover, expanding benefits akin to Special Economic Zones (SEZs) will reinforce India’s position as a global hub for space manufacturing and services.

ISpA recommended granting deemed SEZ status to space technology parks and manufacturing clusters, extending duty-free imports of components and equipment, zero-rated inter-SEZ supplies, and simplified foreign currency management for exports.

The Association also called for implementing employment-linked tax deductions for hiring scientific, engineering, and technical staff; providing concessional GST and customs duties for R&D equipment linked to end-use certification.

“India is at a pivotal moment in its space journey. By recognizing space as critical infrastructure, mandating private sector involvement, rationalizing taxes, incentivizing R&D, and enhancing regulatory certainty, the Union Budget 2026-27 can significantly transform the Government’s role from a provider to a partner and essential buyer,” ISpA concluded.