Indian Space Association seeks GST Exemption, Tax Breaks and PLI Scheme in Union Budget 2024

The Indian Space Association (ISPA) has presented the government with a complete set of ideas aimed at implementing favourable budgetary measures in the next Union Budget 2024-25. These policies are intended to significantly expand the country’s satellite business while also encouraging innovation in the space sector.

ISPA has urged the government to exempt satellite companies from Goods and Services Tax (GST), which includes satellite, launch vehicle, and ground equipment manufacture. The industrial association emphasises the significance of expanding this exemption to critical inputs in the manufacturing process. In addition, ISPA is advocating for tax breaks and exemptions for space-related businesses, as well as customs duty discounts for specific imports.

ISPA’s suggestions address the need for clarity in the space sector’s foreign direct investment (FDI) strategy, including the establishment of a clear framework to attract foreign investment. The association has also advocated the implementation of a Production Linked Incentive (PLI) programme designed exclusively for space-grade components. This is intended to boost indigenous industrial capacity and minimise reliance on imports.

ISPA emphasises space technology’s potential applications in a variety of fields, including agriculture and disaster management. The association recommends implementing space technology solutions in various fields, emphasising the benefits of increasing production, monitoring disasters, and boosting overall efficiency.

In its proposals, ISPA has proposed lowering the tax rate on external commercial borrowings to 5%, with the goal of making financing more available for space projects. Furthermore, the association seeks capital subsidies for infrastructure expenditures in order to stimulate private sector participation in space-related infrastructure.

Lt. Gen. AK Bhatt, ISPA’s Director General, emphasises the importance of a comprehensive regulatory framework in propelling the space industry. He emphasises the importance of tackling existing fiscal and tax difficulties in order to stimulate innovation and ensure the sector’s financial well-being.

ISPA asks the government to explore its ideas for promoting the expansion of commercial space firms. By utilising the government’s backing and imaginative policies, these businesses have the ability to provide major socioeconomic advantages to the country.

As ISPA aligns its plans with IN-SPACe’s 10-year goal, it expects significant growth in the space sector. The suggested measures aim to not only drive innovation but also encourage the adoption of space technology applications and cost-cutting initiatives, helping to meet the ambitious $44 billion target set for 2033. The success of these plans might establish India as a major player in the global space sector, promoting economic growth and technical innovation.