Background

India's space programme has achieved remarkable milestones in satellite technology and planetary exploration. However, a peer-reviewed study published in Economics Letters analyzing over six decades of rocket launches has brought attention to India's relatively high launch costs compared to other major spacefaring nations.

Key Findings

Cost Comparison (2025)

  • India: USD 13,302 per kg of payload to LEO
  • Global Average: USD 3,868 per kg
  • United States: USD 3,225/kg (lowest among major nations)
  • Japan: USD 5,287/kg
  • China: USD 5,809/kg
  • Russia: USD 6,682/kg
  • Europe: USD 9,897/kg

Reasons for High Costs

  1. Limited Economies of Scale
  • India frequently uses smaller launch vehicles
  • Fixed costs of each launch are distributed over smaller payloads
  • Results in higher per-unit cost compared to heavy-lift vehicles
  1. Low Launch Frequency
  • India does not conduct launches frequently enough to generate substantial learning and scale economies
  • Since 2010, statistically significant cost reductions have been observed mainly in the United States and Europe
  • IN-SPACe projected 30 launches between January 2024 and March 2025, but India fell considerably short
  • Only 5 launches were recorded in 2025

Current Capabilities and Gaps

Domestic Launch Vehicles:

  • LVM-3 (Geosynchronous Satellite Launch Vehicle Mark III): India's heaviest rocket
  • Limited heavy-lift capacity constrains larger satellite deployments

Private Sector Developments:

  • Since the space sector was opened to private participation in 2020, approximately 400 space start-ups have been registered with IN-SPACe
  • July 2026: Skyroot Aerospace launched India's first privately built orbital rocket, marking a significant milestone
  • Growing efforts to increase launch capacity, innovation, and competition

Dependence on Foreign Launch Providers

Why Indian Operators Turn to Foreign Rockets

  • Limited domestic heavy-lift capability and launch availability
  • Some satellites exceed the payload capacity of India's launch vehicles

Notable Examples

  • November 2024: NewSpace India Limited launched the 4,700-kg GSAT-N2 communications satellite aboard SpaceX's Falcon 9 from Cape Canaveral
  • The spacecraft exceeded the payload capability of India's LVM-3
  • Europe's Arianespace did not have an operational launcher available
  • Indian start-ups like Pixxel and Digantara launched commercial satellites aboard SpaceX rideshare missions
  • GalaxEye also booked Falcon 9 launch slots

Strategic Implications

Growing SpaceX Dominance

  • SpaceX accounted for approximately 75% of global payload placed into orbit in 2025
  • Highlights increasing concentration in the global launch market
  • Potential dependence on a single major provider

Strategic Vulnerability

  • Dependence on foreign launch providers creates strategic risks:
  • Vulnerability to geopolitical restrictions
  • Pricing power concentrated with few providers
  • Diplomatic pressure risks
  • Access to space may become constrained by external factors

Way Forward

  • Encouraging private participation in space sector
  • Developing heavy-lift launch capabilities
  • Increasing launch frequency to achieve economies of scale
  • Promoting innovation in launch vehicle technology
  • Building domestic manufacturing ecosystem for space hardware