It is the summer of 2050. You set out for the holidays and step into a vehicle that will take you on a 200- mile journey. Secured in a commercial space shuttle, you thrust back into your seat as the shuttle rockets into the sky. Within minutes, pressure doubles. Your weight presses against you and a few moments later, you enter space and are weightless. In a few hours, you inhabit an inflating orbiting habitat that you rented out for the week. And just like that, a space once constrained is commercialized.
The barriers to space are diminishing as advances are made. With the privatization of the space industry, what once was science fiction has turned into reality, paving the way to a new era of space colonization. Collaborative advancements into space, brought about by an increased contribution by space enthusiasts Elon Musk (SpaceX), Jeff Bezos (Blue Origin) and Richard Branson (Virgin Galactic), have made impeccable progress in the space sector and have also surpassed NASA. Bezos has a vision of eventually creating a ‘Moon Village’ by sending autonomous rovers to the moon and Elon Musk has launched 9 rockets within five months in 2018 with one of them being the most powerful spacecraft ever sent into orbit. SpaceX aims at its first manned mission to Mars in 2024 and with almost 1 billion dollars invested in space-focused start-ups, the space industry shows no signs of a slow-down.
An inexhaustible pull of gravity away from our blue miniscule planet may seem daunting until the ‘space economy’ is seen as a part of the larger commercial industry. And understanding this phenomenon would require bringing space down to earth. As we enter a significant moment in space exploration, space-related opportunities for investing emerge. They can be broken down into four main sub-sectors- goods transportation, parts suppliers, passenger transportation and investing in infrastructure. However, space tourism and space exploration seem to be the key drivers of the space startups.
Where To? “To The Stars”
The wait is over for wealthy tourists, corporate researchers and space enthusiasts. Innovation in space goes beyond just stars and planets, the era of space transport and travel is just a step ahead and great potential exists for improved efficiency of space transport. With space flight, intercontinental travel could drastically change and theoretically at a speed of 18,000 mph, passengers could reach any destination in 30 minutes or less on earth. The idea of transporting passengers has captured the ambitions of several companies. Richard Branson’s firm claims to have the funds to fly tourist trips to the edge of space at the cost of around $250,000 for a round trip and Blue Origin said that it would do the same on its New Shepard suborbital rocket. While uncertainty surrounds these plans, NASA is hiring private companies to build landers, rovers and spacecrafts, to transport scientific instruments to the moon. This program is likely to iterate towards the grand vision and from an economic point of view, it promises new opportunities and revenue.
As commercial space opportunities begin to advance, infrastructure to support space transportation will develop and this will bring with it the threat of space debris. The declining costs of deploying, building and developing satellites means more objects doing rounds in the orbit which also elevates the chances of collisions. A number of start-ups (Astroscale, one of the most well-funded companies working towards the same has raised 132$ million since 2013) are working on the same as it seems to be one of the biggest threats to the space economy and could put a dent on the space economy before it even takes off. Development in space could also integrate with earth-bound infrastructure as travelling longer distances could mean refuelling and restocking space stations.
A Deep Impact
The most lucrative business in space could be won by the country that simply gets its laws right. The US Space Act of 2015 allows companies to own rights on the materials mined by them in space. “The first trillionaire will be made in space” claims Texas senator Ted Cruz. As to how trillionaires will make their riches in space, insiders reckon that it would be from mining asteroids. Planetary Resources, the first asteroid company was founded by Chris Lewicki, Diamandis and a few others in 2012 and ever since, a host of other firms have been established, signalling the beginning of the race to riches in space. Japan’s Hayabusa, the first spacecraft to have landed and successfully returned with samples from an asteroid in 2010 also happened to reveal the two types of asteroids of relevance to the mining community, namely, ‘Achondrites’ and ‘Chondrites’, the former being a group of metals rich in platinum and the latter, being rich in water and more valuable to astronauts as a vital source of hydration and also an efficient radiation shield. With plans to build hotels and moon bases by space wizards like Musk and Bezos, the asteriod rich in water could prove to be invaluable.
With relatively young firms steering the new era of space exploration as a free market, their progress has engendered a significant enthusiasm among the masses and it goes without saying, where there is enthusiasm, private investment follows. Venture capitalists are speculated to be paying more attention to start-ups in the space commercialization sector and proof of it lies in the fact that VC investment in 2015 in the space sector increased by a massive 2,052% since 2012. It is undeniable that most of the investment is accumulated in companies such as SpaceX and O3b Networks; however it signifies an appetite from private investors towards supporting the sector as a whole.
The Indian Space Sector
The global space economy is pegged at $360 billion while the Indian space economy is valued at a mere $7 billion, which is only 2% of the global space sector. To reach its targeted $50 billion, the Indian space sector would have to grow at an exponential compound annual growth rate (CAGR) of 48%. Bryce, a research firm claimed that space start-ups raised 3.2$ billion in funding in 2019. However, India attracted only a small share of capital investments despite having a well-developed space programme. The ecosystem for investing in the space sector is nascent in India given that India possesses the capabilities to become a major player in the global space sector. This is mainly due to the inability to attract seed funding and Venture Capitalists. Privatisation of manufacturing will help capture a larger share of the global market. Reviewing the absence of a space policy becomes essential as it is proving to be a hindrance for commercialization. Creating a conducive environment through positive tax laws, insurance arrangements, suitable legal provisions and a strong regulatory agency is crucial along with giving start-ups unimpeded access to capital funding in order to scale operations.
India recently approved private sector participation in the range of space activity. A new government created institution, the Indian National Space Promotion and Authorisation Centres (IN-SPACe) aims to provide private companies to make use of Indian space infrastructure while promoting private sector involvement in the space economy through creation of a friendly regulatory environment and policies. New Space India Limited, a recently created public sector enterprise will now shift the focus to a demand-driven model from a supply-driven one while efficiently utilizing India’s space assets. These reforms pave the way for ISRO to focus more on research and development, human space flight programs, new technology and space exploration missions
Beyond the opportunities mentioned, the new frontiers offer tantalizing possibilities in space exploration. The ideas of today could be the happenings of tomorrow, travel could upgrade from flights to space shuttles, goods could be delivered with the speed of light by a rocket, mining equipment could be sent in space to extract minerals from asteroids all of the above possible, theoretically with the increasing breakthroughs and involvement in space commercialization.
In conclusion,
the opportunities are endless and the sky is not the limit.
Rhea Dias
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