To support space sector startups, the Union Cabinet has approved a Venture Capital Fund worth Rs 1,000 crore. This fund is expected to assist approximately 40 startups across India. The sole aim would be to drive the growth of the private space sector and foster advancements in space technology.

Furthermore, the Centre’s goal with this capital infusion is to retain domestic space companies by attracting additional funding for later-stage development. Finance Minister Nirmala Sitharaman had announced during the Union Budget 2024-25 that the fund will be deployed over five years, wherein, an average annual deployment of Rs 150-250 crore.

So to say, Rs 150 crore has been allocated for FY26, which is further followed by Rs 250 crore per year for the next three years. Also, it is reported that Rs 100 crore will be allocated in the final year. The fund will be managed by the Indian National Space Promotion and Authorisation Centre (IN-SPACe) which is the agency responsible for promoting private sector participation in the space industry.

Also to note, the proposed investment range is between Rs 10 crore and Rs 60 crore. This depends on the company's stage, growth trajectory, and also the potential impact on national space capabilities. Moreover, investments for the growth stage might reach up to Rs 30 crore, and when it comes for the late growth stage, it could range between Rs 30-60 crore. Number of space tech startups in India which include Agnikul Cosmos, Skyroot Aerospace, Bellatrix, GlaxEye, Dhruva, SatSure, Vesta Space, Digantata and InspeCity, have raised venture capital.