In 2020, Hyderabad-based Skyroot faced a cash crunch. Its founders, Pawan Kumar Chandana and Naga Bharath Daka, had raised $1.5 million, but the funds were depleting and no rocket prototype existed.
Skyroot’s turnaround sparks a new era
Six years later, the company broke that impasse. By early 2026 it became the first Indian private firm valued at over $1 billion and achieved a successful maiden launch, placing it among only three nations with commercial orbital capability.
The broader private space scene has followed suit. Agnikul Cosmos unveiled the world’s first 3D-printed rocket engine, Pixxel Space secured contracts for Earth-observation data with NASA and the U.S. Department of Defense, and Bellatrix is pursuing very-low-earth-orbit satellites.
“India’s private space ecosystem has come a remarkable distance in a relatively short time,” said Lt Gen (retd) AK Bhatt, director general of the Indian Space Association.
Startup counts illustrate the shift. Roughly 450 space-tech firms operate today, up from 47 in 2021, and six private companies have launched 18 satellites since 2021, a figure that was zero just five years earlier.
These developments matter as space infrastructure now underpins modern economies and defence, rivaling telecoms, semiconductors and energy in strategic importance.
Policy reforms and funding environment
Regulatory change began in June 2020 when the finance ministry opened the sector to private end-to-end activities, allowing firms to build rockets, launch satellites and sell downstream services.
The creation of IN-SPACe as a licensing authority and NSIL as ISRO’s commercial arm gave startups access to government facilities for modest fees. A 2023 space policy and a 2024 rule easing foreign direct investment to 100% further accelerated capital inflows.
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Compared with the early 2000s, when Indian engineers could only join ISRO or move abroad, the current climate offers a domestic path for high-tech entrepreneurship, echoing the shift that once transformed India’s IT sector.
Talent migration supports the boom. Both Skyroot founders are former ISRO scientists, and a 2022 survey found that eight of the twenty most-funded space startups were founded by ex-ISRO personnel.
Despite the influx of money, growth-stage financing remains limited. Only nine Indian space firms report revenues above $10 million, whereas the United States hosts about ten companies exceeding $100 million in annual sales.
Commercial traction is hampered by client expectations. Prospective buyers often demand fully operational solutions from day one and free pilot programmes, a hurdle for firms still perfecting complex hardware.
A recent setback highlighted reliability concerns. In May 2026, GalaxEye Space launched Mission Drishti, a 190-kg Earth-observation satellite, but the craft lost contact two months later after a solar storm, with investigations pointing to sub-standard components from a third-party supplier.
Cost efficiency remains a challenge. A 2025 study placed India’s expense at $13,302 per kilogram to low-Earth orbit, higher than Europe ($9,897), Russia ($6,682), China ($5,809) and the United States ($3,225).
Skyroot’s Vikram-1 remains a single-use vehicle, and Agnikul has yet to prove a reusable orbital launch, showing the technology gap that Indian startups must bridge to compete globally.
Building a sustainable space ecosystem
The Indian government has already taken steps in this direction, with the creation of IN-SPACe as a regulator and NSIL as ISRO’s commercial arm. These initiatives have helped to open up the space sector to private companies and have provided a framework for investment and growth.
