The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the establishment of a Rs 1,000 crore Venture Capital fund to support startups in India’s growing space sector. The fund will be managed by the Indian National Space Promotion and Authorisation Centre (IN-SPACe), which was established to promote private sector participation in space activities. The Rs 1,000 crore will be deployed over five years, with an average annual allocation ranging between Rs 150 crore and Rs 250 crore.
The deployment plan will begin with Rs 150 crore in the financial year 2025-26, followed by Rs 250 crore per year from 2026-27 to 2028-29. The remaining Rs 100 crore will be deployed in the financial year 2029-30. The fund is expected to support approximately 40 startups, with individual investments ranging from Rs 10 crore to Rs 60 crore.
Early growth stage companies may receive up to Rs 30 crore, while late-stage growth startups could receive funding between Rs 30 crore and Rs 60 crore. These investments will help startups across the entire space supply chain, including upstream, midstream, and downstream segments. IN-SPACe, with locations in Bhopal and Ahmedabad, will oversee the management of the venture capital fund.
Cabinet approves fund for space startups
The agency was launched in 2022 to support space startups and facilitate the growth of India’s space economy. IN-SPACe will be crucial in identifying potential investments, managing the fund, and fostering a vibrant innovation ecosystem within the space sector.
The establishment of the Rs 1,000 crore Venture Capital Fund is expected to advance space technology and contribute to India’s broader economic goals. The fund is designed to help India achieve a five-fold expansion in its space economy over the next decade. By supporting space startups, the fund will promote job creation in high-tech sectors like engineering and software development and indirectly in supply chains, logistics, and professional services.
Union Minister Dr. Jitendra Singh stated that the Modi government’s major initiatives in the first 100 days of its third term signify its commitment to advancing India’s role on the global innovation stage. Besides enhancing India’s scientific prowess, the initiatives aim to contribute to a sustainable, self-reliant economy that can withstand global shifts in industry and resources.
Singh emphasized that these initiatives will also ensure India’s leadership in critical domains such as space exploration, biotechnology, and meteorology. The decision to open the space sector to private players has significantly transformed its ecosystem, with the number of space tech companies growing from just one to hundreds today.
