Analysis | PSLV Setback Testing India’s Space Policymaking? A Wake-Up Call for India’s Rule-Making Moment
- Tanushri Joshi
- 1 day ago
- 5 min read
by Tanushri Joshi
Technology puts you in orbit. Governance keeps you there.
Rocket failures in the space ecosystem are not unusual. Yet the recent third-stage failure of the PSLV C-62 mission has captured global attention, and particularly in India, not because it undermines a launch vehicle long regarded as reliable, but because it brings India’s space policy, liability and risk allocation mechanisms, and insurance frameworks into public focus.
This technical anomaly has brought an underlying issue to the fore. As India’s space ambitions expand across both governmental and private sectors, technological capability and operational preparedness alone are no longer sufficient. Incidents like these act as stress tests for a nation’s legal, policy, and regulatory maturity, as well as its willingness to align with or deliberately diverge from governance mechanisms adopted globally.
A Shift From Government-Driven Missions
India’s space sector was predominantly government-driven, with the state absorbing the entire risk in the event of failures. Earlier PSLV setbacks rarely raised questions about risk allocation. That perception has now fundamentally shifted.
The current mission carried not only government spacecraft but also satellites and commercial payloads from Indian startups and private sector actors, both domestic and international. With this transition from purely government-driven missions to private participation, launch failures today no longer raise only technical questions. They raise fundamental questions of responsibility: who bears the loss, and how?
This shift demands a reassessment of India’s readiness to govern a commercial space economy at scale.
The immediate attention on space insurance following the PSLV failure highlights gaps in the current system. Compared to the pace of technological advancement in India’s space program, policy and regulatory practices for space activities remain underdeveloped and heavily reliant on ad hoc arrangements.
Globally, space insurance is not treated as a standalone commercial product but as a policy instrument. With increasing commercial participation, countries such as the United States, the United Kingdom, France, and Australia have capped private-sector liabilities and clarified government indemnity and risk absorption limits. India, by contrast, continues to operate in a gray zone. Liability exposure under international treaties remains undefined, domestic liability caps are unclear, and the government’s indemnity posture is not codified in law.
This uncertainty raises critical questions. How will insurance markets respond? Will this lead to higher premiums, exclusions, or a reluctance to insure Indian missions?
Pressure to Align With Global Practices or India’s Opportunity to Rewrite Governance
Incidents like this often pressure states to adopt norms, policies, and regulatory frameworks practiced elsewhere. Calls to align with global insurance practices have grown louder. Yet these global frameworks themselves deserve scrutiny.
Alignment or standardization often translates into importing frameworks designed for different national strategic objectives, risk appetites, capital structures, and financial systems. Blind adoption risks favoring entrenched foreign players while constraining domestic startups and industry. A governance framework tailored to national needs is therefore essential.
Today, governance is shaped not only through international treaties but also through domestic policy frameworks, licensing conditions, and technical standards. Some countries recognized this early and used national governance tools to shape global space governance. Alongside the shift toward private participation, there is also a shift in rule-making that is fragmented, technical, and highly strategic.
India, however, has largely prioritized technological development and private sector promotion while postponing difficult governance choices, often relying on executive policy and adoption rather than authorship.
India’s Paradox: Capability Without Confidence in Rule-Making
India is not new to space. Over decades, it has executed extraordinary technical missions, mastering cost-effective launch systems, deep-space exploration, satellite navigation, and complex interplanetary missions. Yet it remains hesitant to proactively shape rules, particularly at the global level.
This reluctance does not create neutrality. It creates a vacuum. During moments of stress, such vacuums often lead to the uncritical adoption of foreign governance models rather than the development of policies aligned with national vision. Frequently, these imported models are ill-suited to India’s security and strategic needs, both in the short and long term.
While confidence in technological capability is high, hesitation in rule-making raises questions about India’s space diplomacy. Part of this stems from a mindset of adoption over curation. Even the simple act of adopting foreign templates for commercial contracts can, over time, harden into accepted practice and eventually into standards.
Another factor is trust. There remains a persistent bias toward foreign technologies, standards, certifications, procurement processes, authorization templates, and even governance frameworks. The result is a form of regulatory dependence, where legitimacy is derived externally rather than built internally.
For a country with India’s space heritage and ambitions, this approach carries long-term costs. Rule-making is where technological capability is translated into strategic influence. Without confidence in shaping frameworks grounded in national priorities and informed by operational experience, India risks remaining adaptive rather than agenda-setting. The challenge is not one of competence, but of conviction.
Why This Setback Is a Pivotal Moment for Space Governance
The PSLV failure has achieved what years of policy discussion could not. It has forced attention onto the often invisible but critically important architecture of space law, policy, and diplomacy.
India now faces a choice: respond defensively, or pause, analyze, and respond strategically. This moment can be used to articulate and assert an Indian vision of space governance rooted in national realities, long-term ambitions, and strategic priorities.
The First-Mover Advantage in Policy and Governance
First-mover advantage does not belong solely to technology. It also applies to policy and governance. This is evident in areas such as space resource utilization, the Artemis Accords, satellite data governance, orbital resource management, and space sustainability.
When a nation develops new technologies, standardizes practices, and builds ecosystems around them, it effectively makes policy. Defining how resources are extracted, how data is shared, how traffic is coordinated, or how debris is managed turns practice into precedent. Precedents are rarely negotiated; they are adopted.
Regulatory development in some countries is moving so rapidly that technologies once encouraged are soon labeled unsustainable or impermissible. Often, this is not because they are inherently risky, but because they do not align with the practices of early movers.
This dynamic disadvantages smaller or late-entering space nations. By the time they are technologically ready, the rules have already been written, often without their participation. Compliance then becomes mandatory through standard contracts, market pressure, licensing norms, and diplomatic signaling rather than treaties.
Thus, first-mover advantage shapes not just innovation, but the permissible future of space activity itself.
Conclusion
The recent PSLV setback should not be viewed narrowly as a technical or insurance-related issue. It is a moment that highlights how deeply technological ambition is intertwined with legal preparedness, national strategy, and diplomatic foresight.
In an increasingly crowded and competitive environment, India’s traditional comfort with avoiding proactive rule-making risks becoming a strategic liability. If India does not help shape future standards, it may find itself constrained by norms written elsewhere for priorities that do not reflect its developmental needs, security concerns, or industrial strengths.
At the core of effective rule-making lies a clear national space strategy. Without a shared vision defining priorities, risk appetite, commercial objectives, and strategic red lines, policy interventions will remain reactive and fragmented. Rule-making cannot substitute for strategy; it must flow from it.
Diplomacy is equally critical. It is no longer ancillary to space missions but intrinsic to them. Every launch operates within a dense web of international coordination involving spectrum access, orbital management, insurance negotiations, and evolving norms on safety and sustainability. Space diplomacy is, therefore, mission-critical.
If India aligns technological excellence with strategic clarity and diplomatic intent, it can translate capability into influence by shaping the rules, practices, and norms that will govern outer space in the decades ahead.
About Author
Tanushri Joshi is an independent space lawyer and business consultant. Previously, she worked with commercial space companies and has contributed to enabling key missions in India, including the first private rocket launch and the first private hosted payload mission. She now advises companies on space laws, regulatory & policy compliance, as well as business development and expansion strategies. She is a member of the International Institute of Space Law.
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