India’s Space Ambitions Face Reality Check as Launch Costs Remain World’s Highest
New Delhi – India’s aspirations to capture a significant share of the global commercial space market are hitting a fiscal hurdle. Despite a reputation for "frugal engineering" and the historic rise of its private sector, a new academic analysis reveals that India currently maintains the highest rocket launch costs among the six major global powers capable of orbital insertion.
According to a study published in the September edition of Economics Letters by economists Alessio Terzi (University of Cambridge) and Francesco Nicoli (Politecnico Institute of Turin), the cost of launching a satellite from India by the end of 2025 stood at approximately $13,302 per kilogram. This figure—derived from missions coordinated by NewSpace India Ltd (NSIL)—is more than four times the $3,225 per kilogram recorded in the United States, the lowest among the nations studied.
The Cost Gap
The data places India at the top of the expense list, even surpassing the European Union ($9,897/kg), Japan, Russia, and China. This finding challenges the prevailing narrative that India’s space program is synonymous with low-cost efficiency.
The discrepancy, according to the authors, is rooted in the scale and frequency of missions. "The very high figure for India might be counterintuitive… however, this is a result of focusing on small rocket sizes, which implies that, albeit being low by international standards, fixed costs get amortised over a limited payload," the study noted.
The Private Sector Challenge
While India has made strides in privatizing its space sector—marked by the successful commercial launch by Skyroot Aerospace on July 18—the transition to cost-competitiveness remains a long-term goal.
Skyroot’s Vikram-1 rocket, for instance, is projected to cost roughly $11,000 per kilogram at peak capacity. This remains significantly higher than the price points offered by industry giants like SpaceX, which leverages the massive payload capacity and reusability of its Falcon-9 rockets to drive down prices.
"What India should work toward is to try lowering its launch costs to match the EU first, and then Japan—to levels of about $7,000 per kg," says Chaitanya Giri, a space fellow at the Observer Research Foundation (ORF). "Rivalling the US is too far into the future; we don’t have the technical capabilities to do that yet."
Scaling and Sustainability
The gap between India and the global leaders is also one of cadence. In August 2025 alone, SpaceX conducted eight successful missions, leveraging its high frequency to optimize costs. Conversely, India completed only four successful missions throughout the entire year, split between the older GSLV-Mk2 and the heavier LVM3 vehicles.
To bridge this divide, experts suggest that the Indian Space Research Organisation (ISRO) must pivot toward developing sustainability-focused, reusable technologies. By transferring these advancements to the private sector, India could potentially lower the barrier to entry and achieve the government’s ambitious "Decadal Vision"—a target of $3.5 billion in annual revenue from satellite launch services by 2033.
As Luisa Corrado, an economist at the University of Rome, noted in a separate study, India’s historical frugality is a tool for mission design, but it cannot replace the necessity of high-investment, scalable infrastructure. For now, the "steep hill" facing India’s private space industry is not just atmospheric—it is fiscal.
