The space economy is central to India’s global connectivity aspirations, and Mumbai is integral to this equation
Image Source: Holger Leue/via Getty Images
Since the Indian government’s 2020 space sector reforms and the subsequent National Space Policy 2023, the state governments of Tamil Nadu, Andhra Pradesh, Telangana, Karnataka, and Gujarat have drafted their respective space policies. The reasoning behind such state space policies is straightforward. These states are anticipating large investments in the space sector from domestic players and overseas companies, who will take advantage of the government’s relaxed foreign direct investment policies in the space sector. The government has publicly announced its goal to increase its share in the global space market from 2 percent to 8 percent by 2033, and that the global space economy will grow from nearly US$ 650 billion at present to US$ 1 trillion by 2035. The states want to capitalise on this forecasted growth. With clear policies, they aim to generate high-tech employment, benefit from increased tax revenues, and boost their gross state product. The same applies to Maharashtra, where Chief Minister Devendra Fadnavis has assured a state space policy earlier in 2025. However, what should be the foundation for Maharashtra’s state space policy?
The government has publicly announced its goal to increase its share in the global space market from 2 percent to 8 percent by 2033, and that the global space economy will grow from nearly US$ 650 billion at present to US$ 1 trillion by 2035.
The global economic downturn, India’s march towards becoming the third-largest economy in the world, and its self-confident geopolitical positioning post-Operation Sindoor will all have an impact on the kind of space power India will grow into. Most of the statistics that state space policies quote, including the forecast of a US$1 trillion contribution and a 2 percent contribution from India, originate from sketchy and unverified economic estimates. These have been widely cited in various consulting firm reports referenced by both state and central governments.
The states are also not taking into account two hard facts that are swinging their constructive optimism towards over-optimism. Foreign direct investment in the space sector is a challenging endeavour, as space remains a domain of great strategic importance to countries worldwide. With the US now intending to become a manufacturer after five decades, its unabated salvo of tariffs, and China's restraint on the world’s supply chains of critical products, the FDI in the space sector will not come at the expected pace. States and central ministries influenced by well-marketed global consulting firm reports do not reveal a strategic fact: the Indian space sector is now open to the private sector, but it remains part of the expanded Indian space program, which continues to be among our nation’s highest strategic pursuits and needs to be protected. Unfortunately, the state space policies released to date do not emphasise Aatmanirbhar Bharat. This disregard is even though the Indian space programme enjoys a great reputation across the world for its indigenous capabilities, grown under tremendous international technological sanctions.
Foreign direct investment in the space sector is a challenging endeavour, as space remains a domain of great strategic importance to countries worldwide.
Maharashtra and other states yet to develop their state space policies can undo the gross disregard for Aatmanirbhar Bharat by the state administrations that went ahead with their first policy documents. Maharashtra should adopt a different approach to its space policy, given that despite not have any ISRO or Department of Space installations at home. Maharashtra must not spend efforts attracting the same investors and manufacturers who intend to be in states with ISRO installations, as part of the latter's peripheral ancillary and manufacturing ecosystem. Maharashtra should bank on being the farthest from ISRO.
Maharashtra, particularly the Mumbai Metropolitan Region and its peripheral NAINA region, is poised to become the country's ‘data and AI capital’ and a major global hub. That does not detract from the fact that Mumbai will remain the economic capital of the country and an alpha-plus economic nerve centre of the world.
Mumbai is well-suited to several new-age downstream space tools and technologies which are not seen at present in unison: be it use of geospatial data for risk management, market and supply chain intelligence, sustainability efforts, logistics tracking, economic forecasting, disaster-lending for vulnerable geographies, geospatial-based data twinning, and tokenisation of assets using blockchain-based based space-platforms. These downstream tools and technologies would be important elements of the nation’s economic capital, which Mumbai is.
As the world transitions from terrestrial 5G to space-based 6G, an enormous demand for decentralised satellite communication (satcom) data storage, the integration of satcom with terrestrial telecom, and satellites acting as base stations, will lead to the realisation of synergies between digital twinning and pervasive intelligence. This synergy will ensure the realisation of financially lucrative real-time data analytics, autonomous decision-making, predictive maintenance, and extended reality.
As the world transitions from terrestrial 5G to space-based 6G, an enormous demand for decentralised satellite communication (satcom) data storage, the integration of satcom with terrestrial telecom, and satellites acting as base stations, will lead to the realisation of synergies between digital twinning and pervasive intelligence.
Maharashtra’s space policy cannot be the pursuit of a single government department. It would have to seamlessly fit with the state’s evolving IT and ITeS Policy, the Electronic Policy, the FinTech Policy, the Thrust Sector Policy, the State Innovation and Startup Policy, and the State Export Promotion Policy. Space is part of the Prime Minister’s permanent portfolio; space at the state level should be part of the Chief Minister’s Office.
Another point for Mantralaya to consider is that space, in reality, is not an industrial sector, and the Government of India doesn’t see it that way either. The 2022 Union Budget of the Central Government refers to it as the ‘space economy’. In that sense, it is futile for consulting firms to club space as a distant third option to aerospace and defence policies they draft. The space economy is an enabler of several other sectors in the country, and this fact is appreciated by all Indian conglomerates headquartered in Mumbai, which will eventually be part of India’s space economy growth story.
The space economy is central to India’s global connectivity aspirations, and Mumbai is integral to this equation. Mumbai is India’s densest submarine optic fibre cable landing station, connecting India to the world. The under-construction 45,000 km long, 2Africa Pearls submarine cable connecting Africa, Europe, the Middle East and Asia; the 16,000 km long India-Asia Express connecting India to Singapore, Malaysia, Thailand and Sri Lanka; and the ~9,800 km long India-Europe Express connecting India to Europe via the Persian Gulf, all have landing stations in Mumbai. This gives Maharashtra’s capital an unparalleled advantage as an innovation epicentre for companies that will engage in 6G Space-Air-Ground Integrated Network (SAGIN) systems. This will soon be the backbone of India’s digital economy. SAGIN-based digital connectivity demands of the future have immense economic and technological ramifications, with novel Internet-of-Things applications such as disaster rescue, intergalactic communications, smart transportation, remote-area connectivity, and maritime surveillance on the horizon.
The space economy is central to India’s global connectivity aspirations, and Mumbai is integral to this equation. Mumbai is India’s densest submarine optic fibre cable landing station, connecting India to the world.
Just as a large chunk of the global space economy has been dominated by satellite communications for years, the commerce of space-based data is expected to occupy a similarly large share of the space economy in the near future. It is upon Maharashtra’s leadership to be creative in its space policy framing, aligning it with Aatmanirbhar Bharat, utilising the inherent strengths of its corporate sector and enormous talent pool, and not relying on superfluous consultations. A data-driven state space economy policy is best suited for the state of Maharashtra and its capital, Mumbai and its evolving role in the larger national economy.
Chaitanya Giri is a Fellow at the Centre for Security, Strategy, and Technology, Observer Research Foundation.
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Dr. Chaitanya Giri is a Fellow at ORF’s Centre for Security, Strategy and Technology. His work focuses on India’s space ecosystem and its interlinkages with ...
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