India’s ‘space economy’ valued at ₹36,794 crore

‘India’s space economy has evolved considerably and now accounts for about 0.23% of GDP’

‘India’s space economy has evolved considerably and now accounts for about 0.23% of GDP’

A collaboration between two top-tier educational and research institutions in Thiruvananthapuram has shed an interesting light on India’s “space economy,” the exact contours of which have remained largely vague even as the country’s space program grew by leaps and bounds.

In a first-of-its-kind attempt to gauge the size of India’s space economy, researchers from the Center for Development Studies (CDS) and the Indian Institute of Space Science and Technology (IIST) arrived at a figure of ₹36.794 million. rupees (approximately $5 billion) for the fiscal year 2020-21. The estimated size of India’s space economy, as a percentage of GDP, has shrunk from 0.26% in 2011-12 to 0.19% in 2020-21, they found.

The findings, described in a paper ‘India’s Space Economy: Its Size and Structure’ by CDS Director Sunil Mani; VK Dadhwal, until recently Director of IIST; and Shaijumon CS, Associate Professor of Economics, IIST, were the subject of a webinar on Saturday.

Using internationally accepted frameworks, the authors have examined the annual space program budget and its components; space manufacturing, operations and application. According to the paper, space applications accounted for the largest share of this evolving economy, making up 73.57% (₹27,061 crore) in 2020-21, followed by space operations (₹8,218.82 crore or 22 .31%) and manufacturing (₹1,515.59 crore). or 4.12%).

The budget outlay for space has a considerable influence on the dynamics of the space economy, according to the study. “India’s space economy has evolved considerably and now represents, on average, about 0.23% of GDP (between 2011-12 and 2020-21). We have also noticed a decrease in the budget for space-related activities, which has led to a reduction in the size of the economy in the last two years”, prof. Mani said. The budget outlay in 2020-21 was ₹9,500 crore, down from ₹13,033.2 crore in the previous fiscal year. The estimated size of the space economy was reduced from Rs 43,397 crore in 2018-19 to Rs 39,802 crore in 2019-20 and Rs 36,794 crore in 2020-21.

The study also found that the space budget as a percentage of GDP fell from 0.09% in 2000-01 to 0.05% in 2011-12, and has remained more or less at that level ever since. Relative to GDP, India’s spending is higher than that of China, Germany, Italy, and Japan, but lower than that of the United States and Russia.

While it has limitations, the study is a first attempt to scientifically measure the size of the space economy, Dr. Shaijumon said. Prof. Mani cited the inability to establish the size of the space-based remote sensing industry as a drawback. “The next step for us would be to look at the impact of the space economy on the Indian economy itself. The impact is both direct and indirect,” said Prof. Mani.

For the present study, the authors have relied on documents from the Indian Space Research Organization (ISRO) and Parliament, Comptroller and Auditor General (CAG) reports, data on intellectual property rights and other government data, in addition to spatial publications indexed by Scopus.

The CDS-IIST research project has coincided with new central government policies that open up the sector to private actors. These policies, according to the authors, are very likely to expand the size of the sector through increased private investment and better integration with the global private space industry.

  • The study is a first attempt to scientifically measure the size of the space economy.

  • The estimated size of India’s space economy, as a percentage of GDP, has shrunk from 0.26% in 2011-12 to 0.19% in 2020-21, they found.

  • Relative to GDP, India’s spending is higher than that of China, Germany, Italy, and Japan, but lower than that of the United States and Russia.

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