ABSTRACT
The growing privatization of the activities carried out in the outer space has required the establishment of integrated legal and policy frameworks around the world. India, despite its spectacular successes in the field in the form of the Indian Space Research Organisation (ISRO), has fallen behind in the development of a sound statutory framework regulating commercial space exploration. The Draft Space Activities Bill, 2017 was a first attempt at trying to regulate the space activities of the private sector, but did not pass, leaving a legislative gap. Conversely, the Indian Space Policy, 2023, and the creation of the Indian National Space Promotion and Authorization Centre (IN-SPACe) aim at transforming the way space activities in India are governed through the introduction of transparency, commercialization, and international collaboration. This paper critically evaluates the Draft Bill of 2017 vis-a-vis the 2023 Policy framework and IN-SPACe and evaluates whether the new policy has sufficiently addressed the previous gaps. The paper has also put the space law regime of India in the international comparative perspective, pointing to the questions of liability, authorization and dispute resolution. The paper concludes by giving recommendations on a unified legislation that aligns the international obligations of India with its ambition to become a space power in the world.
KEYWORDS
Space Law in India, Draft Space Activities Bill 2017, India’s Space Policy 2023, IN-SPACe, Privatization of Space, International Space Law, Liability and Licensing.
INTRODUCTION
India started its journey into space exploration with small scale launches in the 1960s but it has now evolved into one of the largest national space programs in the world. With over 100 spacecraft missions in the past, the Indian Space Research Organisation (ISRO) has not only made India one of the leading spacefaring nations but also has generated the need to have a regulatory framework to govern space activities. The commercial success of the Mars Orbiter Mission (2013), and Chandrayaan-3 (2023) has not only confirmed the technological prowess of India but also brought to the fore the need to have a systematic regulatory framework to regulate space activities.
To cope up with the growing involvement of the private players in the field, the Government of India released the Draft Space Activities Bill, 2017. The Bill was supposed to offer a legal framework to licensing, liability and control of space activities, and to ensure that international obligations including the Outer Space Treaty, 1967, were met. Nonetheless, the Bill never became a law, and this creates an issue of lack of clarity over what the private space entrepreneurs should do.
In the meantime, India has recently enacted the Indian Space Policy, 2023, and established the Indian National Space Promotion and Authorisation Centre (IN-SPACe) to promote commercialization and private involvement. This is a paradigm shift in the government-centric space regime to a liberalized and privatized regime. However, a comprehensive law such as the 2017 Bill creates a major gap in the space governance of India especially with regard to liability, dispute resolution, and privatization.
It is against this background that this paper critically examines the Draft Space Activities Bill, 2017 against the backdrop of the evolving space policy in India and establishment of IN-SPACe. The aim is to determine whether the 2017 framework will be valid in the age of privatization and to analyze whether India needs a revised and consolidated space law to address the challenges of the modern age.
RESEARCH METHODOLOGY
This paper is a doctrinal analysis of primary sources of law such as the Outer Space Treaty, 1967, the Liability Convention, 1972, the Registration Convention, 1976, the Draft Space Activities Bill, 2017, and the Indian Space Policy, 2023.
A comparative approach is also used as it compares the Indian approach with other jurisdictions such as the United States ( Commercial Space Launch Competitiveness Act, 2015), Luxembourg ( Space Resources Law, 2017), and Japan ( Space Activities Act, 2016).
Secondary sources, including scholarly literature, policy reports, industry reports, and IN-SPACe and ISRO publications are also utilized in the work.
REVIEW OF LITERATURE
Space law and governance have become increasingly more studied in the recent decades especially with the advent of commercialization and the involvement of the private sector. Researchers around the world have worked to provide an understanding of how international treaties and national legislations interact to present opportunities and challenges. As Bin Cheng and other scholars have noted, the OST is highly flexible in its interpretation, and leaves major gaps as to liability, property rights, and commercialization. Francis Lyall and Paul Larsen argue that the OST principle of non-appropriation limits unilateral action by states, but leaves much open to interpretation, including the rights of private ownership.
In the Indian scenario, the literature has specifically dwelt upon the Draft Space Activities Bill, 2017, that aimed at regulating the role of the private sector. Scholars observe that although the Draft Bill was progressive in its aims, it was characterized by ambiguous liability rules, excessive state regulation by the Department of Space, and a lack of clarity on insurance provisions. Scholars like V.S. Mani also observe that India lags behind in adopting comprehensive legislation, which will stifle innovation and discourage private investment. Critiques further point out that the Draft Bill did not create an enabling environment to startups, particularly in comparison to the developed countries like the United States.
The monopoly of ISRO has also been commented upon. Other scholars, including Ranjana Kaul, note that the dual nature of ISRO as regulator and operator created conflicts of interest and therefore the private sector was not encouraged. This institutional problem is often compared to the American system, where NASA cooperates with industry players such as SpaceX on a contractual basis, sharing risks and rewards. The same is true of the European Space Agency (ESA) and Japan JAXA, which have developed a model of public-private partnerships that balance innovation and control.
More recent work has gone beyond economics and governance to emphasise normative considerations. Other authors warn that unregulated commercialization may recreate the “neo-colonialism of space” where technologically advanced countries have exclusive access to extraterrestrial resources. This criticism also links to the arguments that are associated with the Moon Agreement, 1979, to which India is a signatory and has not yet ratified, which shows the paradox between equity and the liberty of trade. Yet another evolving body of literature is an argument to make space law more inclusive. Researchers like Namrata Goswami suggest that the future space law of India needs to incorporate concept of gender representation, sustainability and democratic accessibility, so as to provide a balanced governance environment.
Therefore, the literature as a whole demonstrates three trends: (i) awareness of the OST as an insufficient and broad framework; (ii) criticism towards the Draft Bill, 2017, in India due to its regulation excessiveness; and (iii) the need to introduce a more inclusive and facilitative policy model. It is on this basis that the relevance of the analysis of the Indian Space Policy, 2023 which aims at addressing the gaps that existed previously and opening new gateways to the involvement of the private sector.
DRAFT SPACE ACTIVITIES BILL, 2017
The Draft Space Activities Bill, 2017 was the first attempt of India to seriously consider legislation regulating the private side of outer space. The Bill was introduced by the Department of Space with an objective to provide a comprehensive legal framework of commercial activities in space and to ensure that activities are in compliance with the international obligations of India under treaties like the Outer Space Treaty, 1967 and the Liability Convention, 1972.
Objective of the Bill
The essence of the Bill was to have a licensing system on the activities of the private entities that are interested in launching satellites, manufacturing of space related equipment, and other commercial activities. It stipulated that they could only engage in such activities with the prior approval of the Central Government. This was in concurrence with Article VI of the Outer Space Treaty which puts the onus of the actions of the private actors squarely on the authorizing state.
The other major goal was to have accountability of damages due to space activities. The Bill allowed the government to indemnify itself against any liability claims internationally, at the same time insisting that the private operators assume responsibility of damages caused locally.Key Provision
- Licensing and Authorization: The Bill required that no individual or organization was allowed to undertake commercial space activity without license issued by the Central Government. Licenses may have conditions attached to them in terms of safety, security and international obligations.
- Liability and Insurance: The private operators had to insure or give some financial guarantees that could be used to cover the damages that could occur as a result of their operations. Nevertheless, the Bill failed to give limits or ceiling on such liability and this raises the issue of practical feasibility.
- Intellectual Property Rights (IPR): The Bill acknowledged the right of the private entities over the innovations and technologies developed in the course of the licensed activities with some safeguards to national interest.
- Penalties: There were provisions to punish nonauthorized space activity, so as to regulate sensitive technologies by the state.
Strengths of the Draft Bill
The Draft Bill was generally recognized as the first step toward modernizing the space law of India. It has opened the door on the participation of the non-governmental entities in space activities. It also showed India willingness to meet its international obligations by incorporating treaty principles into the domestic law as such.
Also, the focus on both IPR protection and insurance requirements were in line with the best international practices and helped potential investors by providing some certainty of the commercial rights.
Criticisms and Limitations
Although the Bill was forward-looking, it was also highly criticized. The other issue was the uncertainty of liability. In contrast to the U.S. model, whereby the amount of financial liability of the private sector is capped, but a government indemnity is possible once the limit is reached, the Draft Bill did not indicate clearly the amount of financial liability that private players had to bear.
One more critique was its excessive centralization. The Bill concentrated virtually all control measures in the hands of the Central Government without the creation of an independent regulator such as the U.S. Federal Aviation Administration or the space resources authority in Luxembourg. This would have resulted in bureaucracy and low transparency in licensing.
The Bill was also incomplete on emerging activities like space mining, data commercialization and space tourism, which are fast becoming relevant globally. Without attending to these frontiers, critics contended that the legislation had a risk of becoming obsolete before the legislation was enacted.
Current Status
The Draft Space Activities Bill, 2017, was also put in the public consultation, but never introduced to the Parliament. It later lapsed, giving way to the Indian Space Policy, 2023 that has a more enabling approach by expressly welcoming private players under the guidance of IN-SPACe. However, the Draft Bill is important as the first serious effort in India to reconcile the obligations created by international space law and the possibilities of a commercialized space industry.
INDIAN SPACE POLICY, 2023 AND IN-SPACe
The ISP, 2023 is an important milestone in the transformation of India, through its state-driven space program into a market-oriented space sector. Unlike the Draft Space Activities Bill, 2017 which was focused on state control, the ISP 2023 is focused on enabling the participation of the private sector, commercialization, and innovation. In its essence, the policy institutionalizes the Indian National Space Promotion and Authorization Centre (IN-SPACe) as an independent regulator, and redefines the roles of ISRO and the private stakeholders.
Establishment of IN-SPACe as Independent Regulator
IN-SPACe was approved as an autonomous nodal agency by the Union Cabinet in June 2020 under the Department of Space. It has the mandate to:
- Grant and control space activities of privates.
- Offer transparent access to ISRO facilities (including launchpads, testing facilities and ground stations).
- Act as one stop shop clearance system in approvals.
Dividing the research mandate of ISRO and its regulatory role, IN-SPACe eliminates the risk of a conflict of interest that the national space agency may have when it competes with the private sector.
Encouraging Startups: Case Studies
Space startups represent one of the success stories of ISP 2023, as they used to be limited due to regulatory obscurity. A number of case studies illustrate this effect:
- Skyroot Aerospace: Skyroot Aerospace is a Hyderabad-based startup which launched the first Indian privately owned rocket (Vikram-S) in November 2022. Through the IN-SPACe, Skyroot has access to ISRO launch and testing facilities.
- Agnikul Cosmos: Agnikul is a Chennai-based startup, developing the Agnibaan launch vehicle, a customizable small-satellite rocket. In 2023, it opened India first privately constructed launch pad and mission control centre at Sriharikota, sanctioned by IN-SPACe.
- Pixxel: A Bengaluru-based company specialising in Earth observation, Pixxel has developed hyperspectral imaging satellites, with the assistance of ISRO facilities. Its partnership with IN-SPACe is a demonstration of its focus on data-driven commercial opportunities in the policy.
These examples show how the policy, together with IN-SPACe, is transforming the space economy in India.
Private Sector’s New Opportunities
The ISP 2023 provides numerous opportunities to the participation of the private sector, such as:
- Satellite Manufacturing: The design, manufacturing and operation of satellites (communication, navigation, and earth observation) are now open to private players. This lessens the monopoly of ISRO and enhances the competitiveness of India in the world.
- Launch Services: The companies will now be allowed to use their own PSLV/GSLV-type launch vehicles (either developed by them or in collaboration with ISRO).
- Space Tourism: The ISP 2023 envisions the potential of space tourism in the future – suborbital flights, orbital hotels, or the lunar tourism-based on the example of global players such as SpaceX and Blue Origin.
- Data Commercialization: Companies are allowed to own and sell satellite data that is gathered using their own constellations. This opens the markets in agriculture, disaster management, climate monitoring and urban planning.
Collectively, these measures place India in a position to possibly reap even a bigger piece of the pie of the global space economy, worth more than half a trillion dollars.
Criticism of ISP 2023
Although popularly received, the ISP 2023 has also been subject to criticism:
- Uncertainty over Liability and Insurance: There is no clarity in the policy over a liability framework in case of accidents or damages that may be caused due to the private missions as compared to the Draft Space Bill, 2017. This is of concern on how India will fulfill responsibilities under the Liability Convention (1972).
- Lack of Clarity on FDI: The policy is silent on foreign direct investment (FDI) even though it supports the entry of the private sector. Investors are still confused over ownership limits, repatriation and technology transfer.
- Coordination Between ISRO & Private Players: Although IN-SPACe is the regulator, the scope of the operations of ISRO and that of the competition of the private sector players are overlapping. Critics state that without a clear demarcation of functions, it is possible to find conflicts in resource allocation and transfer of technology.
These loopholes imply the necessity of a complementary legislation (which is often anticipated as the successor to the Draft Bill 2017) to have a legally binding framework.
COMPARATIVE STUDY: DRAFT SPACE ACTIVITIES BILL, 2017 VS INDIAN SPACE POLICY 2023 & IN-SPACe
The development of the space governance in India, through the Draft Space Activities Bill, 2017 to the Indian Space Policy (ISP), 2023 with the aid of IN-SPACe, depicts a major change in the state-centric nature of regulation to market-oriented, facilitative regulations. Although both initiatives are intended to regulate the participation of the private sector and guarantee the adherence to the international obligations, their philosophy, mechanism and success are quite different.
- Regulatory Approach
The 2017 Draft Bill was largely regulatory and restrictive, in that it placed much more emphasis on government authorization of all space activities. ISP 2023 has a facilitative model with IN-SPACe being an independent regulator and promoter, whereas, the Bill had a state-controlled model with prior approvals required by the operators of launches, satellite usage, and data usage, and, absolute liability on operators of damages. It offers a one-stop-shop clearance system where it allows the private companies to have access to ISRO infrastructure and facilities and thus simplifies bureaucracies.
- Private Sector Participation
The Draft Bill left little room to the private players who could only play supportive roles (such as ISRO component manufacturing), with little operational freedom. The ISP 2023 envisages full participation of the private players, including the manufacturing of satellites, autonomous PSLV/GSLV launches, data commercialization, and space tourism in the future. The new ecosystem is characterised by startups such as Skyroot Aerospace, Agnikul Cosmos, and Pixxel where innovation and entrepreneurship are encouraged.
- Liability and Insurance
The greatest difference is the liability approach. The Draft Bill also made the private operators liable to pay full compensation in the event of accidents or failures and this was considered to deter investment as a result of high financial risks. Although the SP 2023 invites private involvement, it does not specify the liability and insurance structure very clearly, which provides flexibility and uncertainty. This reflects a period of transition as the policy is based on executive discretion instead of the legislation that is binding.
- Compliance with International Law
The two frameworks are geared to bring India into line with international conventions such as the Outer Space Treaty (1967), Liability Convention (1972), and Registration Convention (1976). The Draft Bill codified the state liability and compliance mechanisms explicitly, which is not the case with ISP 2023 where IN-SPACe oversight would ensure compliance with India treaty obligations. Comparative literature indicates that countries such as the U.S. and Luxembourg have both statutory clarity and facilitation, and this is an example of a hybrid construct that India can adapt.
- Opportunities and Challenges
The ISP 2023 opens the door wide to the participation of the private sector in commercial satellite services and earth observation data and other related areas like space tourism. In the meantime, the restrictive licensing proposed in the Draft Bill did not provide much growth prospects. The uncertainty over the policy regarding FDI, the collaboration between ISRO and the private sector, and liability problems is worrisome, however. The authority of IN-SPACe lacks a statutory basis, which means that it can be contested in cases of dispute, which makes it important to have a complementary Space Act.
- Comparative Insights and Lessons
ISP 2023 shows that India is on the move towards commercialization and innovation since the Draft Bill 2017. Whereas control and risk mitigation were the focus of the Bill, the policy focuses on facilitation, efficiency in regulation and expansion of the private sector. The comparative study also indicates that India could learn best practices internationally, adopting hybrid frameworks that blend statutory clarity, regulatory oversight and commercial freedom in order to be in compliance and also to promote innovation.
POLICY GAPS IN INDIA’S SPACE FRAMEWORK
India has made great progress in the governance of space with the Draft Space Activities Bill, 2017 and the Indian Space Policy 2023. Nevertheless, both tools have serious gaps that are a barrier to the confidence and international competitiveness of the private sector.
Draft Space Activities Bill, 2017
Although the Bill is an innovative move, it is weak in various major aspects. The liability provisions are wide-ranging, making licensees solely responsible to pay compensation, with no limit or government-secured insurance system, which poses excessive risk to the private sector. The Bill also lacks a specific dispute resolution system, as well as a means of allocating intellectual property rights generated by space activities. The licensing system is non-specific and very discretionary and there is limited transparency to the investor.
Indian Space Policy, 2023
The ISP 2023 provided IN-SPACe as a regulator and allowed entry of private players in launch, satellite, and data services. Nonetheless, it does not provide clarity on foreign direct investment (FDI) norms, especially in sensitive fields like the satellite communications and Earth observation. In addition, the policy does not mention liability or insurance requirements in any way, creating a regulatory gap. The co-ordination between ISRO and the privates is also a matter of concern where ISRO would have the priority on the critical missions and access to the infrastructures.
Comparative Gaps
In comparison, the U.S. Commercial Space Launch Act mandates operators to insure up to a capped limit of liability and the government provides liability beyond that. Japan has a similar provision in its Space Basic Act of 2008. The UK has a risk-sharing system in place with liability caps, as provided in the Outer Space Act 1986 (amended 2018), and Luxembourg has explicitly provided legal security of ownership of extracted resources to the private sector in its law on space resources of 2017. These comparisons point out that India should move on to statutory mechanisms since policy statements are not enough.
RECOMMENDATIONS
To set up an effective legal framework and to encourage sustainable involvement of the private sector, the following reforms are proposed:
- Implement a limit on liability, and mandatory insurance
India must require third party liability insurance of the private operators and a government scheme of indemnity beyond a stipulated limit. This would make India consistent with the rest of the world and minimize the risks of investments.
- Clarify Space FDI Policy
The government should come out with sector-specific FDI policy that differentiates between strategic and commercial segments (launch vehicles, defense payloads and satellite broadband, data analytics). This would make foreign investments easier and national security as well.
- Empower IN-SPACe into an Independent Regulator
To help in conflict resolution and transparent licensing and tariff-setting, IN-SPACe should be granted quasi-judicial powers, as is the case with TRAI in the telecommunications sector. Without this empowerment, it will become seen as a bureaucratic appendage of ISRO.
- Set up Special Dispute Resolution Mechanism
A special Space Activities Tribunal or compulsory arbitration system could smooth the path of conflict resolution amongst the private actors, ISRO and international actors. This would give certainty and avoid congestion of regular courts charged with the responsibility of securing the safety of the person of the President.
- Encourage the application of Public-Private Partnerships (PPP)
India needs to institutionalize PPPs in GSLV and PSLV launches where the private players can share the facilities and eventually build in-country capacity. This is paramount to scaling the global small satellite launch market. numericSYében advances of scale
- Regulatory Measures thatigen-Ready
In addition to existing issues, India has to foresee some new ones:
- Space Tourism: Safety measures to the passengers.
- Mining of Asteroids: Sharing of benefits and right of possession.
- Satellite Data Commercialization: Finding the compromise between commercial and national security.
India can stand as a leader in legislation, as opposed to a late-mover.
CONCLUSION
The trend in the space governance of India has been one of a slow shift that has seen the state-dominated model becoming gradually replaced by a system that allows more and more involvement of the private sector. Although the Draft Space Activities Bill, 2017 sought to be groundbreaking in its approach, it was hamstrung by the lack of clarity on liability, insurance and foreign investment, and too much state control, which would have rendered the legislation ineffective on the ground. The Indian Space Policy, 2023 has been an evolutionary leap, where a distinct regulator the Indian National Space Promotion and Authorisation Centre (IN-SPACe) is proposed to exercise unbiased control over the industry, and there is a clear opening up of the industry to the private sector in terms of manufacture of satellites, launch services, commercialization of data, and even space tourism.
Nevertheless, the problems are not finished yet. Unanswered questions in the context of foreign direct investment, liability-sharing structures, and institutional coordination between ISRO and the private sector exemplify legislative ambiguity. Furthermore, India being a party to the Outer Space Treaty, 1967, is bound to ensure that non-state actors operate under national authorization and continuing supervision of the state. Comparative experiences in the United States, which has enacted the Commercial Space Launch Competitiveness Act of 2015, and Luxembourg, which pioneered space resources legislation in 2017.
The situation of space governance in India is, therefore, at a point of crisis. Its capacity to reconcile liberalization and sovereignty, innovation and accountability and commercialization and sustainability will dictate the sustainability of its status as a competitive space-faring nation. Although the advances are significant, the integration of such efforts into a solid and comprehensive legal framework is the crucial task to be done.
By – Shrasti Tomar, Amity University Madhya Pradesh.