The Department for Promotion of Industry and Internal Trade (DPIIT) has notified changes in the foreign direct investment norms (FDI) in the space sector. A decision in this regard was taken by the Union cabinet on February 21.

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The government has allowed 100 per cent overseas investment in making components for satellites, as part of efforts to attract foreign players and private companies into the segment.

"The investee entity shall be subject to sectoral guidelines as issued by the Department of Space from time to time," the DPIIT press note said.

Now, the satellite sub-sector has been divided into three different activities with defined limits for foreign investment in each such sector, according to an official statement. Earlier, FDI in the space sector was allowed up to 100 per cent in the area of satellite establishment and operations through government routes only.

By changing the current policy, the government has allowed up to 74 per cent FDI under automatic route in satellite manufacturing and operation, satellite data products, and ground and user segments. Beyond this limit, government approval will be required in these areas for FDI.

Up to 49 per cent FDI is allowed through the automatic route for launch vehicles and associated systems or subsystems, the creation of spaceports for launching and receiving spacecraft. Beyond 49 per cent, FDI in these activities would require government approval, it added.

Further, up to 100 per cent overseas investments are permitted under the automatic route for manufacturing of components and systems/sub-systems for satellites, ground and user segments.