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Union Cabinet Approves Rs 1,000 Crore 'Venture Capital Fund' For Space Startups

This fund will provide crucial financial support addressing the critical need for risk capital with over 250 space startups emerging in India.

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Union Cabinet Approves Rs 1,000 Crore 'Venture Capital Fund' For Space Startups

Union Cabinet Approves Rs 1,000 Crore 'Venture Capital Fund' For Space Startups.

The Indian government approved a Rs 1,000 crore fund on Thursday to support space sector startups in India, according to the Press Information Bureau (PIB India). This move aims to accelerate the growth of private space companies in driving advancements in space technology. The fund will support around 40 startups over five years with Rs 150-250 crore allocated annually. The Indian National Space Promotion and Authorisation Centre (IN-SPACe) will manage the fund as announced by Ashwini Vaishnaw Minister for Railways, Information & Broadcasting, Electronics & Information Technology.


The investments will range from Rs 10-60 crore depending on the company’s growth stage and potential impact on national space capabilities. This initiative seeks to retain domestic space companies and attract additional funding. Additionally, the Cabinet approved two railway projects worth Rs 6,798 crore, spanning eight districts across Andhra Pradesh, Telangana, and Bihar. These projects are proposed to enhance logistical efficiency, and connectivity, and contribute to sustainable development.

The primary goal is to drive innovation in satellite technology, launch vehicles, and space applications which will pave the way to strengthen India’s position in the global space industry and advance the country’s space reforms. Ashwini Vaishnaw said that by investing in local startups the fund aims to create a multiplier effect which means attracting additional funding for later-stage development and retaining Indian space companies.


The  Venture Capital Fund initiative has several key objectives. It seeks to drive innovation among people, enhance global leadership, accelerate growth, boost international competitiveness and support India’s self-reliance in the space sector. Ultimately, this fund is aimed to contribute to India’s vision of becoming a major player in the global space economy.


It also aims to boost global competitiveness and support the government’s vision of an Atmanirbhar Bharat (self-reliant India) he said. Also, this fund will have a major impact on employment generation supporting startups across the entire space supply chain and helping businesses scale, invest in research and development, and expand their workforce, he added. Each investment is expected to generate hundreds of direct jobs in fields like engineering, software development, data analysis, and manufacturing along with thousands of indirect jobs.

The Indian space economy is currently valued at $8.4 billion which is on a mission to reach $44 billion by 2033. This fund will provide crucial financial support addressing the critical need for risk capital with over 250 space startups emerging in India. As an Alternative Investment Fund under SEBI regulations, it will provide early-stage equity to startups that may enable them to scale for further private equity investments.

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Topics
Indian government Space Startup Startup mission union cabinet Venture capital fund

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