Review of Foreign Direct Investment Policy on Space Sector

The Ministry of Commerce & Industry in India has reviewed the Foreign Direct Investment (FDI) Policy concerning the Space sector. The amendments under Para 5.2.12 of the Consolidated FDI Policy Circular of 2020 impact various aspects of the space industry:

• Satellites-Manufacturing & Operation: FDI cap up to 74% is on automatic route, beyond 74% through the government route.
• Satellite Data Products: Involves the reception, generation, or dissemination of earth observation/remote sensing satellite data.
• Ground Segment & User Segment: Includes the supply of satellite transmit/receive earth stations and user ground terminals.

Definitions provided in the policy cover key terms such as launch vehicles, spaceports, and manufacturing of components and systems/subsystems for satellites and segments. The directive will be effective from the date of FEMA notification.

Potential Exam Questions:

• What are the revised FDI caps for satellites-manufacturing & operation in the space sector?
• Explain the role of ground segment and user segment in the space industry as per the updated FDI Policy.
• Define the term "Launch Vehicles and Associated Systems or Subsystems" as outlined in the recent policy changes.

The review of the FDI Policy on the space sector signifies India's readiness to attract foreign investments and expertise in the burgeoning domain of space technology.

Summary:

The Ministry of Commerce & Industry has revised the FDI Policy on the Space sector, allowing for increased foreign investment in satellite manufacturing, data products, and associated systems. The amendments aim to bolster India's space industry and attract global participation.