India's space sector seeks 3x funding boost in Budget 2026
What's the story
The Satcom Industry Association of India (SIA-India) has urged Finance Minister Nirmala Sitharaman to triple the budget allocation for the country's space sector. The industry body made this demand while presenting its expectations from the upcoming Union Budget. Currently, the allocation for this crucial sector stands at a mere 0.04% of India's GDP, which SIA-India believes is inadequate considering its contribution to various national functions.
Budget proposal
SIA-India proposes increase in space sector budget allocation
SIA-India has proposed that the budget allocation for the space sector should be increased to at least 0.12% of India's GDP. This, they argue, would enable the government to spend more without making abrupt expenditure jumps in future budgets. Subba Rao Pavuluri, President of SIA-India, emphasized that every layer of India's national architecture now depends on space assets and called for more public investment in this critical infrastructure.
Connectivity initiative
SIA-India proposes national satellite connectivity mission
Along with the budget increase, SIA-India has also proposed a National Satellite Connectivity Mission. The industry body wants this mission to be funded by the Universal Service Obligation Fund and aimed at improving digital access in remote, disaster-prone areas. The plan would include funding for satellite backhaul for some 40,000 difficult gram panchayats and a multi-year commitment system to ensure predictable and steady services.
Investment incentives
SIA-India calls for investment-friendly measures in space sector
SIA-India has also called for investment-friendly measures in the space sector. These include enabling frameworks for Foreign Direct Investment (FDI), support for joint ventures, and a zero-rated regime or tradable credit mechanism to free working capital in this R&D-heavy industry. The association believes these steps would help India retain its position as a competitive deep-tech hub on the global stage.
Approval streamlining
SIA-India proposes measures for swift approvals and risk mitigation
SIA-India has also proposed the appointment of a designated Certifying Authority for Customs Exemptions and a single process for such exemptions. This is aimed at ensuring swift approvals for essential space hardware. The association has also suggested a Hybrid Production-Linked Incentive scheme specifically designed for long-cycle, low-volume space manufacturing. This would help mitigate risks, scale up capacity, and attract global joint-venture partners to India.