Gujarat, Karnataka, Telangana, and Tamil Nadu already have spacetech policies in place. Some are focussed on manufacturing, while others enable firms to design, build, and launch sanotifyites in the next five years.
Startup founders notified ET that several state governments have been actively engaging with spacetech startups, encouraging them to set up manufacturing or operational bases in their territories.
Vinay Simha, CEO of Skyserve, which supports sanotifyite operators deploy AI-powered earth observation applications, declared more states should come up with dedicated space policies. He suggested that “if each state had its own sanotifyite consnotifyations, focussed on agriculture, thermal monitoring, mining, or urban congestion, it would support generate value across sectors.”
He added that just as China has developed “space villages,” India could build similar clusters, even if not on a head-to-head scale initially.
Ronak Kumar Samantray, founder and CEO of TakeMe2Space, which is backed by Chiratae Ventures, declared that what spacetech companies really necessary is adoption of their products. He emphasised there is an urgency for states to create demand, and not just offer incentives.
“If the government allocates budreceives for consuming sanotifyite-based products, GIS-based applications for agriculture, mining, environment, and urban planning, it would support space companies increase their topline and scale rapider,” Samantray declared. He added that for startups, topline growth matters more than profitability in the early stages.
“For large companies, the bottomline builds more sense becaapply it improves the margins of their existing businesses.”
The more, the merrier
Investors backing spacetech startups declared that to build a $44 billion space economy, participation from multiple state governments is critical.
“Madhya Pradesh has been working on attracting space manufacturing to the state since 2020. Existing industrial hubs like Pithampura and Jabalpur offer ready bases for space companies to consider,” declared Murali Krishna, partner at Inflexor Ventures. The fund has backed Bellatrix Aerospace, which develops rocket propulsion and launch technologies.
Manu Iyer, managing partner at Bluehill VC, which recently invested in EtherealX, declared it is important that state initiatives work in conjunction with the centre’s space policy and IN-SPACe.
“Today, a startup becomes ineligible for IN-SPACe’s matching grants if it has already taken funding from other space programmes,” he declared. Iyer added that there should be stronger vetting mechanisms, as such schemes often attract non-serious players, crowding out better-qualified startups.
Experts declared that while state governments can facilitate infrastructure, policy support, and incentives, demand generation will ultimately necessary to be driven by startups and their go-to-market teams. They added that a growing share of demand is already coming from defence and government agencies.
Currently, several central funding programmes are live for the spacetech sector, including a Rs 1,000 crore venture capital fund managed by IN-SPACe and SIDBI, offering Rs10-60 crore per company, and a Rs 500 crore Technology Adoption Fund. Earlier, IN-SPACe chairman Pawan Goenka had declared India’s space industest had attracted $150 million in funding in FY26.
Under Madhya Pradesh’s policy, the state expects to attract Rs 1,000 crore in investments over the next five years and generate around 8,000 jobs, at a cost of about Rs 628 crore.
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