With an estimated ₹14,500 crore allocated for Earth observation initiatives in the 2025-26 budget, the expected annual return on investment exceeds ₹3 lakh crore, making it one of the most high-impact public investments in recent years.
India’s space sector stands at a pivotal moment, building on the momentum generated by the 2024-25 budget. While the previous year focused on deep-space missions, private sector investment, and regulatory reforms, the 2025-26 budget presents an opportunity to further integrate space technology into governance and public service delivery. This integration could drive significant economic growth and societal benefits.
Key Expectations for the 2025-26 Budget
- Digital Public Infrastructure (DPI) for Earth Observation
One of the most anticipated initiatives is establishing a Digital Public Infrastructure (DPI) for Earth observation, which aims to democratize access to satellite data and geospatial analytics. By providing tools and platforms for data analysis and visualization, this infrastructure can empower government agencies and private players to leverage space-based insights across various sectors.
Sectors such as precision agriculture, disaster management, infrastructure planning, and environmental monitoring could benefit immensely.To support this initiative, a dedicated budget allocation of ₹4,000 crore is proposed. This funding would cover developing and implementing the infrastructure and incentivizing state governments to adopt these advanced solutions. It’s important to note that this is a projected figure, and the actual allocation may vary.
- National Earth Observation Mission
Another major expectation is launching a National Earth Observation Mission, aimed at systematically integrating space-based solutions into governance. This mission would create a consistent demand for satellite-driven products and services, addressing a key challenge faced by Indian space startups: the lack of stable customers.
By procuring satellite data and analytics solutions from private companies, the government can ensure a steady revenue stream for startups, fostering growth and innovation in the private space sector.4 The proposed budget allocation of ₹10,500 crore would support a wide range of activities, including:
- Procurement of satellite-based data and analytics.
- Establishment of state-level Earth observation centers.
- Promotion of public-private partnerships to drive innovation and adoption.
This is also a projected figure, and the actual allocation may vary.
Economic Potential of Space-Based Solutions
Investing in Earth observation infrastructure and its integration into governance is expected to yield substantial economic returns:
- Agriculture: Improved crop yield prediction and resource management could boost the sector by ₹2 lakh crore annually.
- Infrastructure Planning: Efficiency gains in planning and execution could contribute ₹1 lakh crore each year.
- Disaster Management: Real-time tracking and early warning systems could save ₹50,000 crore annually.
- Environmental Monitoring: Mitigation of pollution, deforestation, and illegal mining could result in ₹40,000 crore in annual benefits.
With an estimated ₹14,500 crore allocated for Earth observation initiatives in the 2025-26 budget, the expected annual return on investment exceeds ₹3 lakh crore, making it one of the most high-impact public investments in recent years.
2024-25 Budget Highlights
The 2024-25 budget laid the groundwork for these ambitious goals, with a ₹13,033.2 crore allocation to the Department of Space, representing an 18% increase from the previous year. Key highlights included:
- Deep-space Missions: Progress on Chandrayaan-4 (lunar sample return), Venus Orbiter Mission, and Gaganyaan’s expansion (precursor missions and planning for an Indian space station).
- Private Sector Support: Establishment of a ₹1,000 crore Venture Capital Fund (VCF) to support 40 space startups over five years.5
- Regulatory Reforms: Liberalized FDI policy, streamlined spectrum allocation for satellite communication, and operationalization of IN-SPACe (Indian National Space Promotion and Authorization Centre) guidelines to enhance private sector participation.6 IN-SPACe is an autonomous agency under the Department of Space specifically created to promote, handhold, and authorize private sector activities in the space domain.7
Predictions for the 2025-26 Budget
As the official budget announcement approaches, the space sector anticipates:
- Increased Budget Allocation: A higher allocation for the Department of Space to support the integration of space-based applications into governance.
- Focus on Earth Observation:
- ₹4,000 crore for the Digital Public Infrastructure (DPI) for Earth observation.
- ₹10,500 crore for the National Earth Observation Mission, supporting public-private partnerships and state-level centers.
- Emphasis on Government Procurement: The government is expected to actively procure space-based solutions from private companies, fostering innovation and creating a stable demand for their services. This will be further enabled by New Space India Limited (NSIL), a public sector undertaking under the Department of Space, which plays a crucial role in commercializing space technologies and fostering private sector participation.8
The Power of Space for Governance
The 2025-26 budget is expected to institutionalize the use of space technology for governance and public service delivery in India. By prioritizing investments in Earth observation infrastructure and incentivizing private sector participation, the government can unlock transformative economic and societal benefits. These initiatives will not only strengthen India’s digital governance capabilities but also accelerate the growth of the domestic space economy.
To further strengthen the sector, the budget could also address the need for skilled manpower through initiatives for education and training in space science and technology. Additionally, promoting sustainable space practices, such as space debris mitigation and responsible use of space resources, could be another focus area.
International Comparison and GDP Percentage
Currently, India spends approximately 0.04% of its GDP on its space program.9 This is considerably lower than the United States, which allocates around 0.28% of its GDP to space activities. China’s spending is estimated to be between 0.1% and 0.2% of its GDP, while Russia’s is around 0.12%. In terms of overall budget allocation, India’s space budget accounts for roughly 0.5% of the total government expenditure. While this percentage has been steadily increasing, it remains lower than that of other major spacefaring nations. Increasing the space budget’s share of both GDP and overall expenditure could signal India’s commitment to becoming a leading power in the space domain.
Conclusion
India’s space sector has high expectations for the 2025-26 budget. With a focus on Earth observation and the integration of space-based solutions into governance, this budget has the potential to propel the nation into a future where space technology plays a central role in improving lives. By harnessing the power of space for national development, India could cement its position as a global leader in space technology and innovation.
The upcoming budget is not just another financial exercise but a unique opportunity to leverage space for transformative growth, economic resilience, and societal well-being.
