When it launched its first rocket in 1963, India was a poor country pursuing the most advanced technology in the world. That projectile, whose nose cone was wheeled to the launch pad by a bicycle, placed a small payload 125 miles above Earth. India barely pretended to keep pace with the United States and the Soviet Union.
In today’s space race, India has found a much more secure position.
In a sleek and spacious missile hangar an hour south of Hyderabad, a hub for Indian tech startups, a crowd of young engineers immersed themselves in a small, experimental cryogenic thruster engine. The two founders of Skyroot Aerospace spoke between the hissing blasts of steam and shared how happy they were when they saw a rocket of their own design on India’s first private satellite launch last November. These new thrusters will launch Skyroot’s next one into orbit this year, carrying a much more valuable payload.
Suddenly, India has become home to at least 140 registered space technology start-ups, comprising a local research field that will transform the planet’s connection to the final frontier. It is one of India’s most sought after sectors for venture capital investors. Startup growth has been explosive, jumping five when the pandemic started. And they see a big market to serve. Pawan Kumar Chandana, 32, CEO of Skyroot, expects 30,000 satellites to be launched worldwide this decade.
The importance of India as a scientific power is central. When President Biden hosted Prime Minister Narendra Modi in Washington last month, the White House said in a statement that the two leaders “called for enhanced commercial cooperation between the US and Indian private sectors across the value chain of the space economy.” Both countries see space as an arena in which India can emerge as a counterbalance to their mutual rival: China.
For its first three decades, the Indian Space Research Organization, or ISRO, the local version of NASA, made the country proud: Until 1995, an image of India’s first satellite graced the two-rupee note. its space ambitions, with young researchers focused on more tangible developments in information technology and pharmaceuticals. Now India is not only the most populous country in the world, but also the fastest growing major economy and a thriving center of innovation.
Space travel has also changed. Driven more by private enterprise than by gigantic government budgets, space technology fulfills small-scale, commercial purposes. Imaging systems send information about the planet back to Earth, allowing Indian farmers to insure their crops or allow commercial fishing fleets to track their catch. Satellites carry telephone signals to the furthest corners of the country and help operate solar farms far from India’s megacities.
Since June 2020, when Mr Modi announced a boost to the aerospace sector, opening it up to all kinds of private ventures, India has launched a network of companies, each driven by original research and homegrown talent. Last year, aerospace startups raised $120 million in new investment, at a rate that doubles or triples annually.
As ISRO, pronounced ISS-ro, gives way to new private players, it shares a profitable legacy with them. The spaceport, on the coastal island of Sriharikota, is located near the equator and is suitable for launches in different orbital levels. The government agency’s “workhorse” missile is one of the most reliable in the world for heavy loads. With a success rate of nearly 95 percent, it has halved the cost of insurance for a satellite, making India one of the most competitive launch sites in the world.
And there’s money to be made in launching equipment into space: That market is worth about $6 billion this year and could triple in value by 2025.
In Hyderabad, the work loft is occupied by Dhruva Space, which deploys satellites and was India’s first space start-up, fashionably dotted with dummy satellites, atmospherically controlled laboratories known as clean rooms, and an artificial gravity testing rig. Each month, Kranthi Chand, the head of strategy, is barely there as he spends about a week in Europe and a week in the United States gathering clients and investors.
It was Elon Musk who stole India’s – and the world’s – thunder from the aerospace industry. His company, SpaceX, and its relaunchable rockets cut the cost of sending heavy objects into orbit so much that India could not compete. Even today, from US spaceports at $6,500 per kilogram, SpaceX’s launches are the cheapest anywhere.
India has an abundance of affordable engineers, but their lower salaries alone cannot beat the competition. That leaves an Indian company like Skyroot to focus on more specialized services.
“We’re more like a taxi,” said Mr. Chandana. His company charges higher rates for smaller payload launches, while SpaceX is “more like a bus or a train, where they take all their passengers to one destination,” he said.
SpaceX propelled India’s startup energy to space. By the time Mr. Modi made it a priority, some of ISRO’s own engineers were getting into the game, including Skyroot’s Mr. Chandana and his partner, Bharath Daka, 33.
One of India’s advantages is geopolitics. Two countries that have long offered cheaper options for launches are Russia and China. But the war in Ukraine has all but ended Russia’s role as a competitor. OneWeb, a British satellite start-up, took a $230 million hit after Russia seized 36 of its spacecraft in September. OneWeb then turned to Indian ISRO to send the next constellation of satellites into orbit. Similarly, the US government would be more likely to allow a US company to send military technology through India than through China.
India’s supplier ecosystem is huge. Decades of doing business with ISRO created about 400 private companies in clusters around Bengaluru, Hyderabad, Pune and elsewhere, each dedicated to building specialty screws, sealants and other products suitable for the space. One hundred can collaborate on a single launch.
Skyroot and Dhruva work in the relatively sexy launch and satellite delivery sectors, but together they account for just 8 percent of India’s aerospace pie. A much larger portion comes from companies that specialize in collecting data that is beamed by satellite.
Pixxel is a remarkable start-up in that field. It has developed an imaging system to detect patterns on the Earth’s surface that are beyond the range of ordinary color perception. It has headquarters in Bengaluru and an office in Los Angeles – as well as a contract with a secret agency within the Pentagon. Even larger chunks of the satellite business will inevitably go to consumer broadband and TV services, beamed down from low orbit.
In Skyroot’s hangar, the engineer-turned-entrepreneurs, trained at two of India’s original institutes of technology and hands-on experience gained at ISRO, speak the language of venture capital finance. After “the seed round,” Mr. Chandana tells me, “the next series is A, which was about 11 million, and then there’s a 4.5 million bridge round.”
Their company is now valued at $68 million after four rounds. But they don’t plan to pay out anytime soon. They are clearly more enthusiastic about the science than the business, which neither of them studied. Running a business, Mr Chandana said, is ‘just common sense’.