The proposed fund is expecting to improve employment in the Indian space sector by supporting startups across the entire space supply chain — upstream, midstream, and downstream. It will help businesses scale, invest in R&D, and expand their workforce.

The Union Cabinet, chaired by the Prime Minister Shri Narendra Modi on October 24, approved setting up of Rs 1,000 crore venture capital fund dedicated to space sector, under aegis of IN-SPACe .

The deployment period of the proposed Rs 1,000 crore VC fund is planned to be up to five years from the actual date of start of the fund operations. The average deployment amount could be Rs 150-250 crore per year, depending on the investment opportunities and fund requirements.

The move is expecting to expand the growth of the private space sector in India, driving advancements in space technology. The Centre aims to continue domestic space companies and hopes that this capital infusion will facilitate additional funding for later-stage development. This fund was announced by Finance Minister Nirmala Sitharaman during the Union Budget 2024-25.

The fund’s deployment period will extend up to five years from the start of its operations, with an average annual deployment of Rs 150-250 crore, the Centre said. In the financial year 2025-26 (FY26), the Centre has estimated a fund of Rs 150 crore for this project. In the three subsequent years, a fund of Rs 250 crore will be allocated, while in the final year, the amount is expected to be Rs 100 crore.