When Skyroot Aerospace’s Vikram-1 lifted off on July 18, it marked a defining moment for India’s rapidly expanding commercial space industry, demonstrating that privately built rockets can now play a role in the country’s orbital ambitions.
The launch placed India among a small group of countries where private enterprises have demonstrated the ability to conduct orbital launches, highlighting the transformation of a sector that for decades was overwhelmingly controlled by the state-run Indian Space Research Organisation (ISRO).
For India’s private space companies, however, the successful launch is only one part of a much larger challenge. Having demonstrated that they can build sophisticated spacecraft and launch systems, startups now need to secure substantial capital, develop reliable supply chains, attract highly specialised talent and, crucially, find enough customers to turn technological breakthroughs into sustainable businesses.
Skyroot’s progress illustrates both the opportunity and the scale of investment required.
The Hyderabad-based company became India’s first space startup to surpass a US$1 billion valuation after raising US$60 million in a funding round co-led by Singapore sovereign wealth fund GIC and Sherpalo Ventures in May.
Its Vikram-1 is a seven-storey, multi-stage launch vehicle designed to carry payloads of up to 350 kilograms into low-Earth orbit.
The rocket’s successful mission demonstrated how rapidly India’s commercial space sector has developed since the government opened the industry to greater private participation in 2020.
For decades, India’s space programme was centred on ISRO, which developed the country’s rockets, satellites, launch infrastructure and many of the technologies supporting its space activities.
The opening of the sector created opportunities for private companies to enter areas ranging from launch vehicles and satellite manufacturing to Earth observation, communications and space-based data services.
The government subsequently established the Indian National Space Promotion and Authorisation Centre, or IN-SPACe, to regulate private space activities and facilitate greater participation by commercial companies.
According to IN-SPACe, more than 400 companies are now part of India’s private space ecosystem.
The agency is seeking to accelerate that growth by helping startups access technology, financing and customers.
“We are trying to see what technology transfer can be done with ISRO so they don’t reinvent the wheel,” said IN-SPACe director Rajeev Jyoti.
The agency is also working on technology adoption funds, public-private partnerships and measures designed to generate demand for products developed by emerging space companies.
The emphasis on technology transfer is significant because developing space hardware from scratch can require enormous amounts of capital and years of testing.
Instead of forcing every startup to duplicate capabilities already developed by ISRO, policymakers hope to allow private companies to build on existing national expertise while focusing their resources on commercial applications.
In June, IN-SPACe selected its first group of startups for support under its Technology Adoption Fund scheme.
Among the beneficiaries was Bengaluru-based SatSure, which uses satellite imagery and other data to generate information for applications including agriculture, infrastructure, lending and insurance.
The company is also working with the Indian government to develop Dhaarini, an Earth intelligence system using India-specific artificial intelligence capabilities.
SatSure co-founder and chief executive Prateep Basu described the system as a “backbone” for interpreting the enormous quantity and variety of satellite imagery now being generated.
The objective is to make complex Earth-observation information accessible through an interface that ordinary users can interact with more easily.
“You can simply interface like what you do on ChatGPT. You can interface over Dhaarini – tell me what happened on this particular piece of land and it will give you the answers,” Basu said.
The development reflects a broader evolution in India’s space industry.
Rather than simply building satellites and selling access to them, companies increasingly want to convert space-based observations into commercially useful information.
Farmers, financial institutions, insurers, infrastructure developers and government agencies can potentially use such information to assess land, monitor crops, evaluate risks and track changes on the ground.
But these services depend on a constant supply of reliable and detailed satellite observations, creating another opportunity for companies developing and operating commercial constellations.
One of the most ambitious examples is Pixxel, another Bengaluru-based startup that is building what it describes as a “health monitor for the planet” through hyperspectral imaging satellites.
The technology collects information across numerous wavelengths of light, producing detailed datasets that can reveal characteristics that conventional satellite imagery may not capture.
Pixxel founder and chief executive Awais Ahmed said the company saw an opportunity because hyperspectral imaging had not yet been commercialised at scale.
“Since no one else was doing it commercially globally, we thought, okay, here’s a gap we can build and launch our own constellation of hyperspectral satellites,” Ahmed said.
The company aims to establish a position in a specialised market where detailed Earth-observation data can be used for environmental monitoring, agriculture, mineral identification and other applications.
Pixxel has attracted significant international attention. In 2024, NASA selected the company to supply commercial hyperspectral Earth-observation data for scientific research.
The company currently has six satellites in orbit and aims to launch as many as 24 additional satellites over the next two years.
Its expansion illustrates the capital-intensive nature of the commercial space industry.
Building a single satellite may require substantial investment, but establishing a constellation involves repeated launches, ground infrastructure, data-processing capabilities and a long-term operational commitment.
Pixxel and SatSure are also members of Allied Orbits, a four-company private consortium planning to invest more than US$130 million in a 12-satellite Earth-observation network.
With support from IN-SPACe, the proposed network is intended to collect data for applications ranging from agriculture and infrastructure management to climate monitoring and disaster response.
The plans demonstrate the scale of India’s emerging private space ambitions. But they also expose one of the industry’s biggest weaknesses: access to late-stage capital.
While Indian startups have increasingly attracted seed and early-stage investment, companies requiring tens of millions of dollars to expand face a more difficult funding environment.
Ahmed said the challenge becomes particularly visible once companies move beyond their earliest fundraising rounds.
“You can see this trend across anyone that has raised anything beyond a Series A,” he said.
“If the round size, I think, exceeds US$10 million, maybe US$15 million, there aren’t many Indian funds willing to take the risk of writing such a large cheque at that stage.”
For space companies, the problem is especially acute because the sector requires large upfront investments and often has long development cycles before generating substantial revenue.
A launch vehicle company, for example, must invest heavily in engineering, testing and manufacturing before it can establish a regular launch schedule. Satellite operators face similarly high costs as they build constellations and associated ground infrastructure.
Recognising the financing gap, New Delhi has introduced a venture capital fund worth around US$105 million to support private space activities.
The government hopes such initiatives will encourage additional private investment and help promising startups progress from experimental technology to commercially scalable businesses.
Yet capital alone may not solve the industry’s problems.
Companies must also develop a sufficiently large customer base capable of supporting the substantial investments required to build and operate space infrastructure.
This is particularly important in a market where many potential customers are government departments and public-sector agencies.
Tapan Misra, a former director of ISRO’s Space Applications Centre, argued that government procurement policies could play a critical role in helping young space companies establish commercial markets.
“The government in the nascent market should help them in having liberal procurement policies,” Misra said.
“In any country, the biggest businessman is actually the government.”
Greater government procurement could provide startups with predictable demand while giving public agencies access to new technologies developed by private companies.
For companies involved in Earth observation, for example, government agencies could become major customers for satellite imagery and analytical services used in agriculture, disaster management, environmental monitoring and infrastructure planning.
However, Misra also stressed that startups must address their own weaknesses.
Companies need to invest in testing facilities, strengthen technical capabilities and develop strategies to recruit highly specialised personnel.
The space sector requires expertise in areas such as propulsion, materials science, avionics, satellite communications, artificial intelligence and remote sensing. Competition for experienced engineers and scientists is therefore likely to intensify as more companies enter the market.
India’s ambitions extend well beyond developing a domestic commercial space industry.
The country’s space economy is currently valued at around US$9 billion and is projected to reach US$40 billion to US$45 billion over the next decade.
Reaching that target will require Indian companies to compete not only for domestic customers but also in international markets.
The success of Skyroot, Pixxel, SatSure and other startups suggests that Indian private companies are increasingly capable of developing technologies that can compete globally.
But technological capability is only the first stage.
India’s commercial space sector now faces the harder task of building sustainable businesses around those technologies. Startups will need access to large pools of long-term capital, dependable launch infrastructure, skilled workers, regulatory support and a growing customer base.
The government has already taken significant steps by opening the sector, creating IN-SPACe, supporting technology adoption and establishing financing mechanisms.
The next phase will test whether those measures are sufficient to help companies move from promising startups into globally competitive space businesses.
The Vikram-1 launch showed that India’s private sector can reach orbit. The challenge now is ensuring that companies such as Skyroot, Pixxel and SatSure have the financial strength and commercial opportunities to stay there.
For India, the transformation of the space sector is no longer simply about allowing private companies to participate. It is about building an ecosystem capable of producing repeatable launches, large satellite constellations, sophisticated space-based data services and internationally competitive companies.
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