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Published on
July 15, 2025
5 min read
Andhra Pradesh Unveils Space Policy 4.0, Eyes ₹25,000 Cr Investment in Aerospace Sector
The state of Andhra Pradesh has launched a bold initiative to position itself as a leader in India’s space sector. The Andhra Pradesh Space Policy aims to attract investments worth ₹25,000 crore under the Space Policy 4.0 in the next 10 years, Inc42 reported.
Andhra Pradesh is also in the process of setting up two exclusive space cities: one in Sri Satya Sai district and the other in Tirupati district, as a part of the new space development strategy.
A Big Push Under Space Policy 4.0
The newly framed Andhra Space Policy 4.0 is designed to align with the broader goals of the national space program. The policy focuses on supporting startups and private players in the Indian Space Sector. Officials say the state plans to offer incentives, such as subsidized land, tax breaks, and expedited clearances, to make aerospace manufacturing in Andhra more competitive.
The policy also talks about the establishment of a special corporation. The body will monitor the development of infrastructure, raise funds for the startups, attract both local and foreign investments and create collaboration with industry players. It will also collaborate with the government agencies in India very closely in order to align with the national space needs as well as access global markets as indicated in the official order.
The government is also working on developing dedicated industrial parks for space and satellite-related manufacturing. The aim is to make Andhra Pradesh a preferred destination for both Indian and global companies looking to invest in space technologies.
Vision for Aerospace and Satellite Ecosystem
Under the new Andhra space investment policy, the state plans to build an end-to-end ecosystem that encompasses every part of the satellite value chain. This includes satellite component manufacturing, integration and testing, launching, and ground-based data services.
The plan also involves setting up an Andhra Aerospace Development fund. This fund will support innovation, research, and local entrepreneurship in space tech. In its new program, the government of Andhra Pradesh intends to fund Indian spacetech startups. Initially, shortlisted startups will receive grants of up to ₹2 lakh, though the total grant is limited to INR 15 lakh per startup. Hackathons and innovation challenges will also be conducted in the state as part of the Andhra Pradesh Space Policy.
The policy offers INR 1 crore in seed funding through the Startup Policy 4.0 and the Ratan Tata Innovation Hub. The Andhra Space Policy 4.0 will also provide incentives to big companies and MSMEs in the field of space and aerospace. The scheme benefits can be availed by a company in INR 125 crore to INR 500 crore and above invested in the company.
This fixed capital investment will be reimbursed by the government by 75 percent, limited to a cap of INR 2 crore, INR 9 crore and INR 15 crore to the micro, small and medium enterprises, respectively. Also, MSMEs can receive a technology transfer subsidy of up to INR 1 crore, thus encouraging them to use modern technologies.
The policy is a 15 percent incentive on the investments made in fixed capital investments by large enterprises, but subject to a limit of INR 75 crore.
Aligning with India’s Space Vision
The policy sets a target of bringing in 25000 crore in space funding over the next few years. Officials believe this will not only boost economic growth but also create around 10,000 direct and indirect jobs. With the increasing demand for satellite-based services, such as communication, navigation, earth observation, and disaster management, the timing for such a policy could not be better.
The Andhra Pradesh Space Policy is being seen as a complementary step to India’s national space mission. With ISRO and private space companies working more closely than ever, states like Andhra are now finding a key role to play.
Andhra’s aerospace development effort, driven by infrastructure upgrades, startup funding, and industry collaboration, is positioning the state as a key player in India’s growing space economy.
