The Union Cabinet has approved the creation of a ₹ 1,000 crore Venture Capital Fund dedicated to the space sector, which will be managed under the supervision of IN-SPACe (Indian National Space Promotion and Authorization Center).
The fund is set to be deployed over a period of up to five years, with an expected annual investment of ₹150 to ₹250 crore, depending on available opportunities. Investments will range from ₹10 crore to ₹60 crore, based on the company’s stage, growth potential, and contribution to national space capabilities. Growth-stage companies may receive between ₹10 crore and ₹30 crore, while late-stage growth companies could be eligible for amounts between ₹30 crore and ₹60 crore.
This initiative is expected to support around 40 startups and is designed to enhance India’s space sector by driving innovation and contributing to economic growth. The fund aligns with national priorities and aims to strategically position India among the leading global space economies.
In addition to fostering innovation, the fund is expected to create a significant number of jobs within the space industry, supporting businesses across the supply chain—from upstream to downstream activities. Investments will help companies expand, invest in R&D, and grow their workforce.
Direct employment in areas like engineering, software development, data analysis, and manufacturing will be bolstered, with indirect jobs created in sectors such as logistics and professional services. By building a robust startup ecosystem, the fund will not only drive job creation but also enhance India’s global competitiveness in the space industry.
Background:
As part of its 2020 space sector reforms, the Government of India established IN-SPACe to promote and oversee private sector involvement in space activities. To further support this, IN-SPACe has proposed the ₹1,000 crore Venture Capital Fund, which seeks to catalyze growth in India’s space economy. Currently valued at $8.4 billion, the sector aims to grow to $44 billion by 2033.
This fund will provide much-needed risk capital, addressing a gap left by traditional lenders who are often hesitant to invest in this high-tech sector. With around 250 space startups already operating in the country, timely financial backing is crucial to their growth and retention of talent. By boosting investor confidence and attracting private capital, this government-backed fund will accelerate space sector reforms, serving as an Alternative Investment Fund under SEBI regulations to provide early-stage equity to startups.
- PIB
