Whalesbook
US Data Curbs Raise Global Risks for Indian Space Firms
The US government's directive to satellite imaging firm Planet Labs to indefinitely restrict high-resolution imagery of Iran and West Asia, effective March 9, has created concern within India's growing spacetech sector.
This action highlights a key challenge for Indian companies with international operations: understanding who controls space-based data and infrastructure. Startups such as Pixxel, Digantara, and Bellatrix Aerospace, which have established US subsidiaries to access capital, customers, and integrate into global supply chains, now find themselves navigating complex international regulations and geopolitical pressures.
Indian Firms Seek Strategic Autonomy
Executives and lawyers note that risks increase when decision-making and data flows are centralized in one country. In response, companies are restructuring their operations. Anirudh Sharma, founder and CEO of Digantara Industries, explained that their US and India entities operate independently under different regulatory frameworks and with distinct mandates. This approach reduces risks tied to capital, customers, or incorporation links. Digantara's intellectual property is designed and owned in India, with other market entities operating under licensed agreements.
This strategy of localized capabilities extends to business functions. Digantara's US entity focuses on areas like missile tracking for the American market, while its India operations concentrate on space domain awareness. This separation of business units is becoming common, driven by financial pragmatism and the need to operate autonomously in different regulatory environments without being dictated by any single government.
India Navigates Capital and Control
Legal experts advise integrating geopolitical risk awareness into business plans, suggesting multi-jurisdictional structuring is essential. Ashok GV, Partner at Factum Law, recommends thorough geopolitical due diligence, careful structuring of subsidiaries, and strategic distribution of intellectual property across countries. Meanwhile, India is seeking to balance growth through initiatives like IN-SPACe, which supports public-private partnerships and government-backed funding, signaling a commitment to building domestic capacity. However, a shortage of long-term capital for space infrastructure, particularly for manufacturing and deployment, remains a challenge.
The tension between accessing global capital and maintaining strategic autonomy is unlikely to disappear. As more Indian startups expand internationally, the Planet Labs incident serves as a crucial reference point for navigating the complexities of the modern global space industry.