The Great Space Unbundling
Since 2020, India has systematically reformed its space sector, a domain once exclusively managed by the Indian Space Research Organisation (ISRO). The goal, formalised in the Indian Space Policy 2023, is to boost India's share of the global space economy
by inviting private companies—termed Non-Government Entities (NGEs)—into the fold. This led to the creation of two new bodies. First, the Indian National Space Promotion and Authorisation Centre (IN-SPACe), which acts as a single-window agency to authorise and supervise private space activities. Second, NewSpace India Limited (NSIL), ISRO's commercial arm, tasked with transferring mature technologies like the Polar Satellite Launch Vehicle (PSLV) to industry and managing commercial demand. The idea is simple: let ISRO focus on science and exploration, while the private sector builds and operates the technology ISRO has perfected.
Why The 'Shrinking' Narrative Took Hold
The perception that ISRO's role is diminishing stems from this very transition. As NSIL began transferring the production of operational launch vehicles and satellites to private firms and public sector undertakings, concerns arose, particularly among ISRO's employee associations. They sought clarity on ISRO's future when its routine manufacturing and operational work was being handed over. The narrative was fueled by statements that, eventually, ISRO would no longer build rockets itself. To an outside observer, this offloading of core duties looked like a downsizing of the agency's historic mandate, prompting fears that ISRO was being privatised.
ISRO's Rebuttal: Not Shrinking, Sharpening Focus
In response to these concerns, ISRO issued a strong clarification in September 2026, stating that reports of its privatisation or shrinking role are "completely baseless and incorrect". The agency stressed that it will remain India's principal institution for advanced space research, strategic missions, and exploration. Officials explained that the participation of private players is not about reducing ISRO's importance but enabling it to concentrate more on its next chapter. Instead of spending resources on routine manufacturing, ISRO's scientific and technical workforce can now focus on frontier R&D, advanced technologies, human spaceflight (Gaganyaan), next-generation launch systems, and deep-space missions to the Moon, Mars, and Venus.
A Bigger Pie for Everyone
The government's strategy is not to cut a smaller slice for ISRO, but to bake a much larger economic pie. India’s space economy is currently valued at around $8.4 billion, with ambitions to grow it to $44 billion by 2033. This requires an industrial-scale expansion that ISRO alone cannot provide. By enabling private players to build and launch rockets and satellites, the reforms aim to create a vibrant domestic space industry. This ecosystem can attract investment, build robust supply chains, and increase India's global competitiveness. In this model, ISRO acts as the scientific engine, developing cutting-edge technology and undertaking complex national missions, while the private sector provides the manufacturing scale and commercial services. It's a move from an ISRO-led sector to an "ISRO-led national space ecosystem".
The Future in 2026: A New Division of Labour
By 2026, this new model is already in action. The number of registered space startups has surged from just one in 2014 to over 440. Private companies like Skyroot Aerospace have successfully launched their own rockets, while others are building satellites and providing data services. IN-SPACe is actively authorising these private missions and facilitating technology transfers. Meanwhile, ISRO is channelling its energies into ambitious projects. Its agenda is packed with frontier science, including the Gaganyaan human spaceflight programme, the Aditya-L1 solar observatory which is already collecting data, and future missions to Venus (Shukrayaan). The organisation is moving away from being the sole producer and operator to becoming the nation's chief innovator and explorer in the final frontier.
