Indian states are in a race to board space-tech wagon
States also see an opportunity to gain priority access to central projects, funding, and tie-ups with the Indian Space Research Organisation (ISRO) by preparing the ground, showing initiative with land, infrastructure, ease of business, and
policy
support, industry watchers said.
'State governments have been actively engaging with spacetech startups and holding consultations. They are encouraging them to establish manufacturing or operational bases within their territories,' said Rohan Ganapathy, co-chairman of the CII National Committee on Space and CEO of Bellatrix Aerospace.
While Bengaluru has led the private space ecosystem in the last decade, policies and invitations from other states are creating strong competition for Karnataka, demanding rapid acceleration, he said.
With the Indian space industry aiming to grow to $44 billion by 2033 and capture 8% of the global market, states are keen to explore revenue generation through investments, industry experts said.
Space pie that states want
A Gujarat government official said it has already received two proposals from electronic component manufacturers to make space-graded components. Gujarat's plan to set up a satellite launchpad in either Dholera or Kutch has garnered the attention of the space industry. The state has linked its
spacetech policy
to its existing
Gujarat Electronics
Policy and Gujarat IT/ITeS Policy.
Tamil Nadu Industrial Development Corporation (Tidco) managing director Sandeep Nanduri said the state has leverage over others due to its strong base in electronics, automotive, and heavy manufacturing. The state's 'Space Industrial Policy' will focus on spacetech services across upstream and downstream.
Tamil Nadu aims to provide better subsidies and a talent pool, Nanduri said without revealing exact details.
Maharashtra chief minister Devendra Fadnavis's announcement of introducing a spacetech policy in the next three months was the latest entrant to the domain.
Bengaluru-headquartered Digantara said while states are not actively driving demand, they are keen to align with central government policies. 'We have had talks with Andhra Pradesh and Telangana to set up satellite manufacturing and assembly lines but have not finalised any plans yet,' its CEO Anirudh Sharma said.
Digantara is evaluating which state offers the best manufacturing subsidies, as the cost of setting up facilities remains high in India.
Early investment will pay off
The demand for spacetech is still in the nascent stages within India. Most startups are looking at the US or European markets to grow their revenues. Industry experts said states are betting on future readiness and also find the domain aspirational, which grabs a lot of eyeballs.
Earlier, ET had reported that startups such as Bellatrix Aerospace, Pixxel Space, and Digantara have set up shop in the US to benefit from non-price-sensitive markets.
'There's a bit of FOMO (fear of missing out) happening too,' said Apurwa Masook, CEO of IISc-incubated SpaceFields. 'No state wants to be the one that doesn't prepare for the next technology boom.'
The startup is developing India's first aerospike rocket engine. 'By moving early, they can anchor clusters to create a gravitational pull for global and ancillary companies,' Masook added.
In-SPACe director (promotions) Vinod Kumar said, 'Incentives are crucial in attracting investments, especially for high-tech industries like space.' States offering strong incentives—tax breaks, subsidies, or a single-window approval process—will create an ecosystem within their states, he said.
While this decentralised growth is a positive signal for innovation and employment, it also demands careful management, Indian Space Association (ISpA) director general, Lt Gen (retd) AK Bhatt said.
'It is essential that state space policies do not lead to fragmentation or duplication, but be a harbinger of added opportunities and fair competition for the growing space sector,' he said. 'Areas like spectrum management, orbital slots, and ITU-level engagements must and will remain coordinated through central authorities.'
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