DR.

RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY

LUCKNOW

AIR AND SPACE LAW (SEMINAR)

FINAL DRAFT

ON:

“COMMERCIALIZATION OF SPACE”

SUBMITTED TO: SUBMITTED BY :

Dr. SHAKUNTALA SANGAM MANISHA GUPTA

ASSISTANT PROFESSOR B.A.LL.B. X SEM.(B)

Dr. RMLNLU Enroll-

 ACKNOWLEDGEMENT

A major research project like this is never the work of anyone alone. Firstly, I would like to

thank respected Asst. Professor SHAKUNTALA SANGAM, for giving me such a golden

opportunity to show my skills and capability through this project.

This project is the result of the extensive ultrapure study, hard work and labour, put into to make

it worth reading. This project has been completed through the generous co-operation of various

persons, especially my seniors, who, in their different potentials helped me a lot in giving the

finishing touch to the project.

This project couldn’t be completed without the help of my university’s library Dr. Madhu

Limaye Library and its internet facility.

‘I am glad to have made it’

Thanking You........
Contents
INTRODUCTION...........................................................................................................................................3
Origins of the Commercial Space Industry...................................................................................................4
THE NEED FOR PRIVATE SECTOR TO BE INVOLVED IN SPACE......................................................................7
 Increasing Demand..........................................................................................................................7
 Overall growth of space sector........................................................................................................7
 Very less global contribution...........................................................................................................7
 International trends and experience...............................................................................................7
BENEFITS OF PRIVATE SECTOR’S PARTICIPATION IN SPACE INDUSTRY.......................................................8
 Greater pool of resources................................................................................................................8
 Human Capital.................................................................................................................................8
 More time for ISRO..............................................................................................................................8
 Technological advancement............................................................................................................8
 Risk Sharing......................................................................................................................................8
 Commercial demand........................................................................................................................8
ISSUES AND CONCERNS OF PRIVATE PARTICIPATION IN SPACE INDUSTRY.................................................8
 Data Risk..........................................................................................................................................8
 Regulation........................................................................................................................................9
 Revenue loss....................................................................................................................................9
 Unfair commercial practices............................................................................................................9
Position of India in ‘Race for space’.............................................................................................................9
SPACE MINING...........................................................................................................................................12
RACE BETWEEN COUNTRIES VERSUS RACE BETWEEN BILLIONAIRES........................................................15
PRIVATE SATELLITES FOR DIGITAL INDIA...................................................................................................16
CONCLUSION.............................................................................................................................................17
“We do not have the fantasy of competing with the economically advanced nations in the
exploration of the moon or the planets of manned space-flight. But we are convinced that if we
are to play a meaningful role nationally, and in the community of nations, we must be second
to none in the application of advanced technologies to the real problems of man and society.”

- Vikram Sarabhai

INTRODUCTION

Space is a very technology-intensive, complex, and long gestation business. To be in the space
business, one needs to possess a huge amount of expertise, patience, tenacity, and deep pockets.
Once successful, this business also has capabilities to create huge entry barriers to sustain and
grow. India’s private sector cannot expect a better situation to be in the space business than now.
With the increased requirements of space missions for various needs, it is a necessity that the
private sector should scale up to expectations. The fundamental requirement from an industry is
to establish heritage, which can happen only over a period of time and at a certain pace before
one can aim to be a major player at a system level. With this it indeed makes sense for an Indian
private player to venture into space. However, most successful industries in the world have
multiple technologies and multiple markets to address, rather than being only in space. Many
times, the space business can be extremely lumpy, which is not what any private industry would
prefer.1 The only way to graduate from a domestic space partner to a global player is to establish
credibility, which comes by gathering domain experience. Human resources in the space domain
are not easily available in the market, and to a large extent, have to be home grown. This can be
one of the key challenges as to why it takes a good amount of time to establish a strong foothold
in the space market. Underestimating the above factors and being overambitious for quick
growth solutions are a taboo in the space industry.

1
Hastings, David A.; William J. Emery (1992). "The Advanced Very High Resolution Radiometer (AVHRR): A
Brief Reference Guide". National Oceanic and Atmospheric Administration.(May 2011).
Origins of the Commercial Space Industry
Between 1963 and 1982, U.S. expendable launch vehicle (ELV) manufacturers produced
vehicles only under contract to the National Aeronautics and Space Administration (NASA) or
the Department of Defense (DOD). In the early 1970s, when private companies and foreign
governments purchased communications satellites, they had to contract with NASA to launch
their payloads. Through NASA, launches could be procured on any one of four ELVs: Titan,
built by Martin Marietta; Atlas, built by General Dynamics; Delta, built by McDonnell Douglas;
and Scout, built by LTV Aerospace Corporation. NASA would purchase a launch vehicle
through traditional government procurement practices, and the launch would be conducted by a
private-sector contractor under NASA supervision.2 The U.S. government essentially served as
the only provider of space launch services to the Western world. Seeing an opportunity to
provide launch services, the European Space Agency developed its own ELV, Ariane, which
became the first competitor to NASA for commercial launches. The first Ariane launch occurred
in 1979, and in 1984, a private company, Arianespace, took over commercial operation of the
vehicle. In the late 1970s, the U.S. government decided to phase out all ELVs, except Scout, in
favor of the U.S. space shuttle. The shuttle would take all U.S. government satellites, as well as
commercial satellites, into orbit. NASA declared the shuttle, which made its first flight in 1981,
operational in 1982, and government funding of ELV production ceased in 1983. It quickly
became evident, however, that the flight schedule of the shuttle could not meet all of the U.S.
security, civil, and commercial launch requirements. As the need grew for more launches than
NASA could handle, some launch vehicle manufacturers expressed interest in offering
commercial launch services. In 1982, the first successful private launch in the United States took
place – a test launch of the Space Services’ prototype Conestoga rocket. The procedures required
to gain approval for that launch, however, proved time-consuming and led to the introduction of
legislation to make it easier for companies to pursue commercial launch activities. A bill (HR
1011) introduced in the House by Congressman Daniel Akaka (D-HI) would have designated the
Department of Commerce as lead agency, while the Senate bill (S 560), introduced by Earnest
“Fritz” Hollings (D-SC), intended to give the lead role to the Federal Aviation Administration
(FAA). Others suggested the lead go to the Department of State or NASA. While Congress
debated the efficacy of its legislation, on July 4, 1982, President Ronald Reagan issued national
security decision directive (NSDD).3 “National Space Policy,” stating that expansion of U.S.
private sector involvement in civil space activities was a national goal. The President’s Senior
Interagency Group on Space subsequently reviewed the policy and concluded a commercial ELV
capability would offer substantial benefits to the nation by:

 Maintaining a high-technology industrial base;

 Providing jobs for thousands of workers, thus adding to the federal tax base;
 Spawning numerous spinoff and supporting activities;
 Strengthening the U.S. global position;

2
Joan Lisa Bromberg (October 2000). NASA and the Space Industry. JHU Press. p. 1. ISBN 978-0-8018-6532-9. 
3
Hastings, David A.; William J. Emery (1992). “the-emerging-commercial-space-industry". National Oceanic and
Atmospheric Administration.(May 2011).
  Providing a potential market for excess flight hardware, special-purpose tooling, test
equipment, and propellants;4 and
 Creating a market for U.S. government and facilities.

On May 16, 1983, the President issued NSDD 94, “Commercialization of Expendable Launch
Vehicles.” This stated the “U.S. Government fully endorses and will facilitate the
commercialization of U.S. Expendable Launch Vehicles. The U.S. Government will license,
supervise, and/or regulate U.S. commercial ELV operations only to the extent required to meet
its national and international obligations and to ensure public safety.” The directive created an
interim space working group on commercial launch operation co-chaired by the Department of
State and NASA. FAA and the Federal Communications Commission also had representatives in
the group. Among other things, the President mandated the group develop and coordinate the
requirements and processes for the licensing, supervision, and/or regulations applicable to
commercial launch operations and recommend the appropriate agency with the U.S. government
responsible for commercial launch activities.5 The group submitted its report on September 15,
1983. It did not recommend a lead agency, but, instead, deferred to the Cabinet Council for
Commerce and Trade. At a meeting of the Council on November 16, 1983, President Reagan
announced his intention to designate the Department of Transportation (DOT) as the agency with
principal responsibility for fostering the private commercial ELV business. His rationale
centered on the fact that DOT, as a department that understood the regulatory process and with
experience as a deregulator (airline, railroad, etc.), was uniquely suited to remove regulatory
barriers and to streamline regulations necessary to create a commercial space industry. In a
January 1984 speech, Secretary of Transportation Elizabeth Dole explained the President wanted
to stimulate interest in commercial space ventures by removing regulatory barriers. She said that
companies trying to operate in space must go through as many as 17 agencies to get appropriate
permits and licenses. DOT would give companies one-stop service to help them “cut through the
thicket of clearances, licenses, and regulations that keep industrial space vehicles tethered to
their pads.” On February 24, 1984, Executive Order 12465 formally designated DOT as the lead
agency for encouraging, facilitating, and licensing commercial ELV activities. DOT entrusted
these duties to a new Office of Commercial Space Transportation. Dole appointed Jennifer
“Jenna” Dorn as the first director of the new office. Prior to her appointment, she had served as
Elizabeth Dole’s special assistant. Congress affirmed and expanded these actions through the
Commercial Space Launch Act, enacted on October 30, 1984. 6 This legislation addressed three
substantive areas: licensing and regulation; liability insurance requirements; and access of
private launch companies to government facilities. Despite the legislation, U.S. launch firms
remained largely uninterested in offering commercial launch services, finding it difficult to

4
See Press Release, House Comm. on Sci., Space Bill Rockets Toward Congressional Approval (Mar. 4, 2004),
available at http://www.house.gov/science/press/108/ 108-195.htm. The sole “nay” vote belonged to Rep. Ron Paul
(R-TX). See Office of the Clerk, H.R., Final Vote Results for Roll Call 39, available at
http://clerk.house.gov/evs/2004/roll039.xml (Mar. 4, 2004).
5
Historically, commercial efforts have been focused primarily on satellites. See Tidal W. McCoy, Structure of the
Space Market: Public and Private Space Efforts, in SPACE: THE FREE-MARKET FRONTIER 127, 134 (Edward
L. Hudgins ed., 2002); Ty S. Twibell, Note, Space Law: Restraints on Commercialization and Development of
Outer Space, 65 UMKCL. REV.589,620 (1997).
6
National Aeronautics and Space Act of 1958, Pub. L. No. 85-868, 72 Stat. 429 (codified as amended at 42 U.S.C.
§§ 2451–84 (2000)) (“Space Act”).
compete against the government subsidized space shuttle. U.S. policy changed in the wake of the
January 28, 1986, space shuttle Challenger tragedy. The government reversed its policy of
phasing out ELVs and instead adopted a mixed-fleet approach where both ELVs and the shuttle
were available for commercial users. On August 15, 1986, Reagan issued NSDD 254, “United
States Space Launch Strategy,” which limited NASA’s role in providing commercial launches to
only those satellites that required the unique capabilities of the shuttle or for which there were
unusual foreign policy considerations. The resulting unavailability of NASA as a domestic
civilian launch service, coupled with the already enacted legislation, led to the emergence of the
U.S. commercial launch services industry. On February 11, 1988, President Reagan issued the
“Presidential Directive on National Space Policy,” which required U.S. government agencies to
purchases launch services from commercial companies. The U.S.-licensed commercial space
industry made its first launch in March 1989 when Space Service, Inc., sent a scientific payload
on a suborbital trip aboard a Starfire rocket.7 Later in 1989, McDonnell Douglas made the first
U.S.-licensed commercial orbital launch on August 27, using a Delta I launch vehicle. On
August 7, 1995, DOT announced that the Office of Commercial Space Transportation would
move from the Office of the Secretary to FAA, effective October 1, 1995, as part of a larger
DOT reorganization. The transfer of the office was delayed, however, until sanctioned by
legislation. The fiscal year 1996 DOT appropriations bill, signed by President Bill Clinton on
November 15, 1995, cleared the way for the transfer of the Office of Commercial Space
Transportation from DOT’s Office of the Secretary to FAA. 8 The transfer became effective on
November 16 of that year.

THE NEED FOR PRIVATE SECTOR TO BE INVOLVED IN SPACE

India is among the global leaders in space exploration. ISRO has spearheaded India’s success in
space. From a modest beginning in the 1960s, India’s space programme has grown steadily,
achieving significant milestones. These include various satellite launch, space-launch vehicles,
and a range of associated capabilities. But private sector has not contribute much to it.

• Increasing Demand

Indian Space Research Organisation (ISRO)’s annual budget has crossed ₹10,000 crore ($1.45 billion)
and is growing steadily. However, demand for space-based services in India is far greater than what
ISRO can provide. With limited number of staff, its difficult to meet the ever increasing demand from

7
On October 4, 1957, at 19:28 Greenwich mean time, a Soviet R-7 rocket was launched from the Baikonur
Cosmodrome in southern Kazakhstan. Minutes later, Sputnik I, a small Soviet satellite capable of little more than
emitting a simple radio signal, achieved orbit; it was the first man-made object ever to do so. See Craig Covault,
Policy and Technology Shape Manned Space Ops, AVIATION WK. & SPACE TECH ., Jan. 8, 2001, at 44; JOHN
F. GRAHAM, SPACE EXPLORATION: FROM TALISMAN OF THE PAST TO GATEWAY FOR THE
FUTURE 58 (1995), available at http://www.space.edu/projects/book/book-6.doc.
8
Ram S. Jakhu, Regulatory Process for Communications Satellite Frequency Allocations, HANDBOOK OF
SATELLITE APPLICATIONS, VOLUME 1 271 (Joseph N. Pelton et al. eds. 2013).
various stakeholders. Therefore, private sector investment is critical, for which a suitable policy
environment needs to be created.

• Overall growth of space sector

Private sector participation is needed to ensure overall growth of the space sector. ISRO
has a strong association with the industry, particularly with Public Sector Undertakings
(PSUs) like Hindustan Aeronautics Limited and large private sector entities like Larsen
and Toubro. But most of the private sector players are Tier-2/Tier-3 vendors, providing
components and services.9 The Assembly, Integration and Testing (AIT) role is restricted
to ISRO. Role of private industries should be increased.

• Very less global contribution

The global space industry is estimated to be $350 billion and is likely to exceed $550
billion by 2025. Despite ISRO’s capabilities, India’s share is estimated at $7 billion (just
2% of the global market). Private sector role is must to increase India’s contributions
globally.
• International trends and experience
Elon Musk’s “SpaceX” and its high profile projects have highlighted the increasing
significance of the private players in the space sector. In India, despite the various
strategic, security and regulatory constrains, a limited private ecosystem has evolved
around the ISRO. Private are merely contracting with national space agencies to build
satellites and subsystems. Contrarily, the current trend is developing entire vertically
integrated operations without licensing or purchase agreements with national agencies

BENEFITS OF PRIVATE SECTOR’S PARTICIPATION IN SPACE

INDUSTRY

 Greater pool of resources

Public resources- land, labour, capital are limited. Private sector participation will open
new pool of resources and talent. It will bring more funding, and experience into space
exploration activities.
 Human Capital
Restricting space activities to ISRO, limits proper utilisation of talent all over the
country. With demographic dividend, private sector participation can exploit the talent
across the nation contributing a lot to space explorations in India.
 More time for ISRO
 Today every space mission is done by ISRO, whether its communication satellite or any
weather monitoring satellite. With increased role of private player, ISRO can concentrate

9
MICHAEL C. MINEIRO, SPACE TECHNOLOGY EXPORT CONTROL AND INTERNATIONAL CO-
OPERATION IN OUTER SPACE 89 (2012).
 more on its pathbreaking innovations like Reusable PSLVs, Cryogenic rockets, mars
inhabitation.10
 Technological advancement
Commercialisation will also develop better technologies which is important. It will allow
integration of many other technologies like artificial intelligence into space exploration
activities. With experience from space activities, private sector can increase role of
technology in other areas.
 Risk Sharing
 Every launch consists Risk. Privatising helps in sharing the risk of cost factor. Failure
costs will be distributed. Also with increased private participation, failures will reduce
due to increased available human capital and mind. Joint venture brings the knowledge
from various stakeholders minimises failures and increases productivity.11
 Commercial demand
 There is need to enhance internet connectivity for the masses, which is another demand
pull factor for increased commercial interest in space. Asteroid mining is also another
potential area that looks promising, with scope for monetisation and disrupting
commodity markets.

ISSUES AND CONCERNS OF PRIVATE PARTICIPATION IN SPACE

INDUSTRY

 Data Risk– Though space it gives an opportunity to entrepreneurs but raw data of ISRO
in the hands of public is sensitive and consists of danger of misuse or improper utilisation
of data.
 Regulation- Though its a profitable investment, regulation of private sector participation
is not easy. The time taken for regulatory clearances and unstable political institutions can
cause delays and hurdle in decision making of investors.
 Revenue loss– ISRO will loose a fair amount of money it is earning through its space
activities. This will reduce government revenue.
 Unfair commercial practices– Allowing private sector may lead to lobbying and unfair
means to get space projects or launch of any satellite for their own profit. It may also lead
to leakage of sensitive information by private players to other countries and companies to
make profit.

India should create an independent body that can create a level playing field for
government and private space enterprises. A new Space law for India should be framed
which should aim at facilitating growing India’s share of global space economy to 10%
within a decade which requires a new kind of partnership between ISRO, the established
private sector and the New Space entrepreneurs.
10
Peter de Selding, Eutelsat Leases Chinese Satellite at 11th Hour to Protect Orbital Slot, SPACE NEWS (May 13,
2011), http://spacenews.com/eutelsat-leases-chinesesatellite-11th-hour-protect-orbital-slot/ [https://perma.cc/7563-
SK2B].
11
Ram S. Jakhu, International Law Governing the Acquisition and Dissemination of Satellite Imagery, 29:1 J.
SPACE L. 65, 73 (2003).
 Position of India in ‘Race for space’
There are various indicators that point the half-way success of commercialization of space.
Advances in reusable rockets, lowered per-launch costs and miniaturization of satellites are
opening up business opportunities well beyond aerospace and defense, and into IT hardware and
telecom. The global space industry is expected to generate revenue of $1.1 trillion or more in
2040, up from the current $350 billion. 12 Amazon founder Jeff Bezos recently outlined a long-
term vision for putting a trillion people in space colonies with one small step coming soon: an
infrastructure starting with lunar lander Blue Moon. While the world has been focused on
China’s impressive space firsts, notably the Chang’e-4 landing on the far side of the moon,
and U.S. proposals for a Space Force, India is seeing steady progress on its own comprehensive
space program. Although ISRO is not confident about giving India’s space programmes to
private players but is looking to partner with a large private company to support spacetech
startups.

 A number of important policy changes have been made and are in the works. These

changes reflect both a changing international environment where nation states are

competing across categories of prestige, military capability, and economics, as well as

India’s increasing material wealth and technological capability. A Standard Chartered

report13 forecasted that India will overtake the U.S. economy ($31 trillion) in nominal

GPD terms by 2030, to become the world’s second largest economy at $46.3 trillion, only

behind China ($64.2 trillion), projected to be the top economy.

 India’s approval of a budget for a manned space mission in 2022, The Gaganyaan

project(to make India a global low-cost provider of services in space) marked a

significant shift in policy. It will aim to send a three-member crew to space for seven

days. The Indian Space Research Organisation (ISRO) is planning to deploy its biggest

rocket, the Geosynchronous Satellite Launch Vehicle (GSLV) Mark III to transport the

three Indians into space.14

 India conducted its first anti-satellite (ASAT) test under the name Mission Shakti (the

anti-satellite interceptor ballistic missile covered 300 kilometers and hit and destroyed

India’s live satellite in low-Earth orbit within three minutes.) The interceptor missile
12
Why big business is making a giant leap into space, Jun,
2019/https://knowledge.wharton.upenn.edu/article/commercial-space-economy/
13
G.A. Res. 1803 (XVII), Permanent Security Over Natural Resources (Dec. 14, 1962) (“Permanent sovereignty
over natural resources . . . 1. The right of peoples and nations to permanent sovereignty over their natural wealth and
resources must be exercised in the interest of their national development and of the well-being of the people of the
State concerned.”) Thus, the sensed states argued that their prior consent was required in order to sense and
distribute the data and images.
14
Saberin, Zeenat. India approves budget for first manned space mission in 2022(29 dec 2018)/
https://www.aljazeera.com/news/2018/12/india-approves-budget-manned-space-mission-2022-
181228194441300.html
 was developed by India’s Defense Research and Development Organization (DRDO).

New Delhi has been historically wary to be seen as an assertive major power in outer

space, yet the ASAT test saw India utilize its space program for demonstrating space

power as “anything a nation can do in or through space.” The ASAT test demonstrated

India’s capability to hit adversary objects in space, a capability the DRDO has possessed

since 2012 but showcased only now after years of restraint. This was the first time that

the DRDO involved in a space mission, and the first time that the Indian Space Research

Organization (ISRO) has participated in a weapons test.

 Our nation is also in a half-way path to create a draft space doctrine. The achievements

has brought opportunity that we can expect further cooperation between the ISRO and

DRDO. Already the ISRO has launched payloads on Microsat-R and EMISAT, and it has

just been announced that beginning in May, the ISRO is expected to launch a string of

defense satellites.

 Another major shift is the growth of India’s private space sector. For the very first time,

India has succeeded in its desire to have the ISRO transfer satellite building technology to

the Indian private sector, with a recent successful launch of a consortium-

manufactured navigation satellite. It is expected that the first private consortium-built

version of the Polar Satellite Launch Vehicle (PSLV) will be delivered and fly in 2020.

The PSLV, which already holds the record for the most number of satellites on a single

launch (104 in February 2017), just achieved a new record of launching 29 satellites to

three different orbits. Among the satellites launched was India’s military intelligence

gathering satellite, the 436 kilogram EMISAT intelligence satellite.

 Perhaps more impressive in the long run, entirely private Indian space start-up Exceed

Space successfully built and launched the first NewSpace satellite on a SpaceX Falcon 9.

The Indian space industry also broke new ground with the ISRO, for the first time

spinning in technology from a start-up, Bellatrix Aerospace.

 Responding to what looks to be a global scramble for space resources, India’s elite

discourse is also shifting. In the last few years, several of India’s space and nuclear

scientists, to include Dr. Sivathanu Pillai, professor and former chief of BrahMos

Aerospace, specify that, “there are plans to mine Helium-3 rich lunar dust, generate

energy and transport it back to Earth.” This perspective is supported by Dr. Srikumar

Banerjee, former director of Bhabha Atomic Research Centre (BARC), who asserts that

the future lies in minerals wealth mining in space. Technology Information, Forecasting,

 and Assessment Council (TIFAC) Executive Director Prabhat Ranjan believes that the

potential exploitation of moon and asteroids as a mineral resource can be a big game-

changer. Even think tanks such as CSTEP have been looking at space-based solar power.

While the discourse on space-based resources has not reached the level of national level

articulation as we see in the United States or China, it is not unrealistic to forecast that it

will become an integral part of India’s space policy given its growing capacity for space

access and power projection.  As seen by India’s recent ASAT test, India’s fears of being

shut out from a governance regime (as happened with the nuclear Non-Proliferation

Treaty) are likely to force sufficient steps before the emergence of a technology

governance regime to ensure New Delhi will at least have a seat at the table.
Those are landmark achievements building confidence for the Indian space industry, which
hopes to service a global market. The industry now includes at least seven companies including
Bellatrix, Astrome, Satsure, Earth2Orbit, ReBeam, TeamIndus, SmartEnovations, and others.
India even now has a youth-focused rocketry club (such clubs were important in creating an
initial talent pool in the first space age). In summary, we can observe significant shifts both in
India’s observed capabilities and policies since 2018. These include successful
commercialization progress on both launch vehicles and satellites (and the introduction of a
Space Activities Bill), a heavy lifter capable of manned missions to LEO and robotic missions to
the lunar surface, an announced human spaceflight program, and perhaps the most critical shift,
the involvement of the DRDO and ISRO in an ASAT test. That test signifies that India’s space
program has entered into the realm of military counterspace capabilities.15

SPACE MINING
While activities on the Moon have virtually ceased since the Moon Agreement came into being,

advancements in science have recently demonstrated that outer space, including the Moon and

other celestial bodies, has more natural resources than mankind thought. What is the legality of

space mining in international law? Article I of the Outer Space Treaty is not entirely clear on this

issue. Speaking on the exploration and use of outer space, including celestial bodies, the Outer

Space Treaty appears to be silent on exploitation of resources in outer space.16 The provision on

freedom of scientific investigation reminds the reader of the old space age when space activities

were dominated by the States that were more concerned with national prestige and international

domination marked by their explorative space activities Like many of its provisions, the

provision on exploitation and use, as well as scientific investigation, are further elaborated in the

Moon Agreement, Articles 6.2 and 11 specifically. The two Articles are not against private

15
Ram S. Jakhu et al., Findings of an Independent Review of Canada’s Remote Sensing Space Systems Act of 2005,
37 ANNALS AIR & SPACE L. 399, 410 (2012).
16
Red-Dwarf Idiot's Guide to Space Mining
initiatives, investments, or interests. Despite its attempts to clarify the Outer Space Treaty, the

Moon Agreement has attracted very few ratifications, with the United States, Russia, China, and

other major spacefaring States not even being signatories to it. The recently rekindled interests

in resources on the Moon and other celestial bodies are reflected inter alia in the U.S. Space

Resource Exploration and Utilization Act of 2015 (the Act) which purports to gives ownership

and title to resources mined in outer space to private entities with the legal ability to transfer the

ownership. The Act is purportedly based on the difference between “national” appropriation

(interpreted by the proponents of the Act to mean “the State” itself) and appropriation by private

entities (interpreted by the proponents of the Act to mean “non-State”). Many arguments,

however, militate against the position of the Act. First, ‘[n]ational appropriation’ must be

understood in a broader sense to include all forms of appropriation, including appropriation by

the public, private or otherwise.” “The Outer Space Treaty imposes an international

responsibility on States for national activities in space” without differentiating activities by State

or non-State actors. The travaux preparatoires ´ of the Treaty supports such an argument. The

USSR had initially opposed the United States’s position of opening outer space to private

activities but ultimately accepted possible participation of private entities in the exploration and

use of outer space upon the condition that such entities must have been authorized by the

applicable States, which would continue to supervise them.17 Thus, Article VI of the Outer Space

Treaty is said to represent a compromise between the two opposing positions, with the result of

non-governmental national space activities being assimilated to governmental space activities.

The Belgian and French representatives noted without contradiction that non-appropriation

covered both claims of sovereignty and “the creation of titles to property in private law.”

Allowing private entities to appropriate outer space or a part of it would defeat not only Article

II, but also render Article I meaningless. Lastly, it was apparently supported by President

Lyndon B. Johnson’s remarks when presenting the Outer Space Treaty to the Senate for consent

for ratification. Without casting any opinion on the legislation, there may be several ways to

relook at the history. First, Article II of the Outer Space Treaty refers to “national appropriation

by claim of sovereignty, by means of use or occupation, or by any other means.” The words

seem to suggest appropriation of land because of the words “use or occupation” and

“sovereignty.” The difference between land and resources lies in fact that while land would

remain there despite use or occupation, resources would be consumed and depleted. Second, the

USSR insisted on national authorization and continued supervision of private space activities

without even touching on the issue of “appropriation,” whether of land, resources, or otherwise.

17
Stephen Gorove, Interpreting Article II of the Outer Space Treaty, 37 FORDHAM L. REV. 349, 351 (1969).
Third, the remarks by the Belgian and French representatives appear to refer to “the creation of

titles to property in private law.” It remains unclear if the term “property” refers to titles in land,

or things found in or on the land. The term “property” has a specific meaning to common law-

trained lawyers, especially English lawyers. It primarily refers to real property as opposed to

personal property or chattels. It is unclear if the same difference is drawn in civil law. In any

event, when it comes to international treaty negotiations, confusions over terminology are

inevitable and abound, more so when a legal term is translated from one language to another and

from one legal tradition to another.18 Thus, with all respect, Manfred Lachs’s personal conclusion

that national appropriation includes sovereign and private rights should, in light of differences in

legal traditions and terminology, be taken with a grain of salt. Fourth, the statement made by

President Johnson was apparently an internal statement and can be construed as merely a

unilateral declaration of a State which, under international law, may be unilaterally withdrawn.

In passing the amended Act in 2015, the United States can be taken as having withdrawn its

unilateral declaration. Thus, if the arguments in support of non-appropriation under Article II

fall, it is debatable how the argument under Article I would stand if private interests are focused

on resources on a first-come-first-extract basis, regardless of who has any title to the land

concerned. After all, while the proponents of space mining may not have any sovereignty or

jurisdiction claim over the lands on the Moon, the opponents do not either. Another pertinent

issue is the interpretation of Article IX of the Outer Space Treaty which provides, inter alia, that

the State Parties shall have due regard to the corresponding interests of all other State Parties

when conducting activities in outer space, presumably including the exploration and use of outer

space, including the Moon and other celestial bodies. Further, the fourth sentence thereof

provides that if a State Party “has reason to believe that an activity planned by another State

Party in outer space, including the Moon and other celestial bodies, would cause potentially

harmful interference with activities in the peaceful exploration and use of outer space, including

the Moon and other celestial bodies, may request consultation concerning the activity.” It is

curious to note that notwithstanding the planned exploitation of space resources by some of the

spacefaring States, no State Parties to the Outer Space Treaty have sought consultation, either the

spacefaring States nor the non-spacefaring States. As far as the former is concerned, national

interests dictate that there should perhaps not be any international protests, for the States

concerned are either eyeing the space resources themselves or are already putting plans in place.

As for the non-spacefaring States, any request for international consultation would probably be
18
Status of International Agreements Relating to Activities in Outer Space, UN OFFICE OF OUTER SPACE
AFFAIRS (Jan. 1, 2010) http://www.unoosa.org/pdf/publications /ST_SPACE_11_Rev2_Add3E.pdf
[https://perma.cc/2YJZ-6BZW] (Australia is apparently the only space-faring country that has ratified the Moon
Agreement. France and India have signed it but have refrained from ratifying it).
to no avail. The discretion on the part of a State Party potentially affected by the space activities

of another State Party as provided for in the fourth sentence stands perhaps in contrast to the duty

on the part of the State Party whose space activity planned by it or its nationals in outer space,

including the Moon and other celestial bodies, would cause potentially harmful interference with

activities of other State Parties in the peaceful exploration and use of outer space, to undertake

appropriate international consultations before proceeding with any such activity. While the land

on the Moon and other celestial bodies are perpetual, resources thereon may be consumed and

vanish thereafter. Thus, the mining activities authorized under the Act would presumably cause

potentially harmful interference with the space activities of other State Parties. Where there is

competition for resources there is potential breach of peace. In such a situation, it would appear

that there would be a reason for the United States to be under a duty to “undertake appropriate

international consultations before proceeding with any such activity.” It remains unclear if the

United States is prepared to undertake such international consultations which might very well

cripple space mining by its nationals ab initio.19 Notwithstanding the lack of exercise of a State’s

duty in Article IX, the failure to exercise a State’s discretion to seek consultation may equally

bring some legal issues, particularly when States dispute over their rights to mine a certain

celestial body or an area thereon. The Outer Space Treaty aside, do the Moon Agreement

provisions represent rules of customary international law? It was unanimously passed by the UN

General Assembly without a vote. It is argued that its low amount of signatories may simply

represent the total lack of activities on the Moon for the past thirty years, and States’ reluctance

to adhere to a treaty which has no practical significance to them, particularly those

nonspacefaring States. On the other hand, the non-ratification appears to evidence conscious

State will, particularly on the part of spacefaring States, not to be part of the Moon Agreement.

Otherwise they would be bound by the Common Heritage of Mankind provision, their actions in

outer space would be restricted, and they could not fully exploit and be entitled to resources

recovered in outer space. Further, the phrase “benefits derived from those resources” is wide and

ambiguous. “Benefits” can very well mean the raw materials mined or recovered, minerals

derived from such raw materials, technology used, and the IPRs of the technology used.96 It

remains unclear if private entities, having invested millions of dollars into the mining mission,

would be willing to share the benefits with other entities or States which have contributed

nothing, let alone the technology. Further, there is no defined formula for “equitable” sharing,

and that is bound to give rise to disputes. In any event, the international community has failed to
19
“Today, outer space is free . . . No nation holds a concession there. It must remain this way . . . [The United
States] do[es] not acknowledge that there are landlords of outer space who can . . . bargain with the nations of the
Earth on the price of access to this domain.” Treaty on Outer Space: Hearing before the Committee on Foreign
Relations, 90th Cong. 105–06 (1967).
establish the mechanism envisaged in Article 11.7 thereof. Thus, space mining is not met with a

corresponding framework of international space law. What would be the impact if States permit

their nationals to conduct mining in outer space? An analogy may perhaps be made with the

Western European powers fighting for colonies and resources in Africa, the Americas, and Asia

in the 19th and early 20th centuries. While States may not encounter hostilities for the purpose of

establishing colonies in outer space, for such would be clearly contrary to Article II of the Outer

Space Treaty, there would be nothing to prevent them from facing off against one another for the

purpose of obtaining resources. The Moon Agreement provides a mechanism for equitable

sharing of benefits, but how many States are prepared to share such benefits? Indeed, it is

arguable that it is the very mechanism of equitable sharing that might have prevented its

widespread acceptance. When the fight for resources takes place in outer space, it may serve as

the raison d’etat ´ for spacefaring States to arm themselves in space, thus potentially bringing

military conflicts to the space.20

RACE BETWEEN COUNTRIES VERSUS RACE BETWEEN

BILLIONAIRES
There are other reasons for pushing ahead with ideas that may seem pie-in-the-sky, says Wharton
management professor David Hsu. “It’s like Google funding big science projects and trying to
push the technology frontier,” he says. “That has a signaling purpose in the marketplace — ‘we
may be making 99% of our money from your searches, but we are thinking about the future and
pushing the frontier a bit.’ They are really trying to work on the harder problems, and maybe we
haven’t thought of all of the uses for a particular technology in all cases. They are on the road
toward that. You want to be able to show technological things that people didn’t necessarily
understand were feasible or possible.” A certain amount of momentum for ideas hinges on
perception, especially regarding a future for the space-tourism industry, Siggelkow notes. “We
know this is a really complicated and to a certain extent dangerous endeavor, and the general
public’s risk appetite is very low. Think about self-driving vehicles and accidents. At what point
do we feel they are safe? There is something similar here. If something happens, I am afraid it
will slow down space tourism quite a bit.” Branson’s Virgin Galactic has already suffered a
visible tragedy. One pilot was killed and another injured in 2014 when experimental spaceflight
vehicle VSS Enterprise broke up during a test flight and crashed in the Mojave Desert. Several
other initiatives have failed, such as Israel’s Beresheet Spacecraft, which in April crashed into
the moon. For now, investors are taking a relatively rosy view of the prospect of making money
in space. In the first quarter of 2019, $1.7 billion in equity was invested into space companies —
nearly the double the amount invested in the last quarter of 2018, according to Space Investment

20
Ricky J. Lee, The Jus ad Bellum in Spatialis: The Exact Content and Practical Implications of the Law on the Use
of Force in Outer Space, 29 J. SPACE L. 93, 93 (2003).
Quarterly, published by Space Angels. Total funding since 2009 exceeds $20 billion invested in
435 companies, the space-centric financial services firm says. With SpaceX, Boeing, Virgin
Galactic, and Blue Origin all inching closer to making history as the first privately funded
companies to launch commercial passengers into space, it was believed that 2019 will most
certainly be the Year of Commercial Space Travel.

PRIVATE SATELLITES FOR DIGITAL INDIA

The Telecom Regulatory Authority of India (TRAI) has also suggested that ISRO ropes in the
private sector to launch satellites in low and medium orbits to expand broadband penetration in
the country to further the government’s vision of Digital India. India had about 31% Internet
connectivity and it was estimated that only 450 million of India’s of 1.25 billion people would
have internet connectivity by June, a report from the Internet and Mobile Association of India
and market research firm IMRB International had said in March. It added that there are potential
approximately 750 million users still in rural India who are yet to become Internet users. But
currently this is not possible given the status of data penetration in the country, especially the
Northeastern parts where laying optic fibre cables is difficult given the rough terrain. 21 One must
mention here that there exists a provision for private players to operate communication satellites
on their own in India through an established mechanism called Committee for Authorizing the
establishment and operations of Indian Satellite Systems (CAISS). Under a policy approved by
the Government of India in 2000, only Indian registered companies with FDI not more than 74%
may be allowed to establish and operate such a satellite system.22

For Indian private industry, space is an elite sector to be in, but success lies in mature and well-
informed decision making. The requirement of the Indian space industry is significantly short of
the stated goals. Space exploration and the space sector provide an immense opportunity for the
Indian and global industry, due to the enhanced demand for satellites and space launch vehicles
(at about 18-20 satellites per year and 12 launches per year).23

The key to success will be through a significant reduction of the cost of access to space, and
ISRO has been instrumental in developing the space and satellite industry clusters in the country.
Almost 75 per cent of the launch vehicle work is being done by the industry, with ISRO
concentrating on its core activities of design, development, integration, and assembly. 24 ISRO
has plans to privatise the operations of its popular Polar Satellite Launch Vehicle (PSLV) by
2020 and private industry has been engaged with ISRO and ANTRIX to formulate a strategy to
enhance the capacity and capability of managing the PSLV programme on an end-to-end basis.
ISRO is looking to set up a joint venture to manufacture the launch vehicle itself. The assembly,
integration, and testing of IRNSS satellites in the private sector is a concrete step towards the
21
Frank Slijper, FROM VENUS TO MARS—THE EU’S STEPS TOWARDS THE MILITARISATION OF SPACE
(2008).
22
Rand Simberg, Certifiable, FOXNEWS.COM, July 24, 2003, at http://www.
foxnews.com/story/0,2933,92840,00.html
23
Commercial Space Act of 2003: Hearing on H.R. 3245 Before the Subcomm. on Space & Aeronautics, House
Comm. on Sci., 108th Cong. 6 (2003) (testimony of Pamela L. Meredith, Co-Chair, Space Law Practice Group,
Zuckert , Scoutt & Rasenberger, L.L.P.) (citing 49 U.S.C. § 70113(a)(1) (2000)), available at
http://www.house.gov/science/ hearings/space03/nov5/meredith.pdf
24
"Technical details for satellite INSAT 1A". N2YO.com – Real Time Satellite Tracking and Predictions. (31
July 2017).
eventual privatisation of commercial satellites, with the design, engineering and manufacturing
of the components for satellites and launch vehicles already in the private sector domain. The
current issue of the delay in the launch of the TeamIndus lunar mission could be ascribed more
to issues that are technical rather than financial, though TeamIndus has admitted to difficulty in
raising of funds – which could be also due to the fact that the launch is linked with the Google
Lunar XPRIZE competition and the 31 March deadline, which even the Israeli team (SpaceIL) is
struggling to meet. TeamIndus indeed has a unique idea to design and build a lunar mission. But
like any start-up, it requires technical expertise, mentoring, marketing, and a business model.
While they may or may not be able to meet the 31 March deadline, it is hoped that they
eventually will be able to launch a technically robust, functional robotic spacecraft on the Moon,
that can meet the demanding and stringent quality control standards of space.

CONCLUSION
As we move towards better technology and bigger budgets for space activities, the commercial
space industry has an opportunity to grow and develop into something more than just a
contractor to governments. The private sector is booming at state and regional levels as a result
of public- private partnerships and the beginnings of privately financed activity - but on the
international stage it struggles to find a voice because, in no small part, nation-states still
dominate international relations and law. If the private space sector is to succeed, it will need to
foster dialogue with governments which, in turn, will need to find the balance between
supporting industry with good policy and avoiding excessive regulation. 25 The United States’
private space sector is robust and flourishing, not only in its most visible components, with
launch service providers like SpaceX and Orbital ATK, but in all facets of space exploration and
utilisation. This is largely due to the approach taken by the US government to support and
regulate private investment in space under the Commercial Space Launch Competitiveness Act,
wherein launch standards are based on ‘voluntary industry consensus standards’. Progress reports
are being submitted to Congress every 30 months until December 2021 when findings will be
revisited and fed into future US space policy. Private companies can and should actively work
for furthering developments in the space sector. A company like ours has been successfully

25
Ruwantissa Abeyratne, Competition in Air Transport—The Need for a Shift in Focus, 33 TRANSP. L. J. 29, 32,
36 (2005).
working in the realm of space for over 25 years. India has expertise and experience in all
segments of space technology. Although some private Indian firms may not have a lot of
experience in certain fields, but they do have expertise in abundance. The expertise of the
employees of the Indian private space sector is at par with developed countries. Given the
opportunity, Indian companies can build around that expertise in others areas too. The catch is
this expertise has to be properly supported by finance, which is often uncertain when it comes to
private firms. The kind of finance that is available to the government/ISRO/Department of Space
is not available to the private sector. Present policies do not allow private industry to grow on it’s
own. All other sectors in India were liberalised/reformed; but unfortunately the space sector has
not been liberalised from government control and monopoly. This creates a sharp divide between
the two sectors, causing the private sector to falter at times.