Schedule I explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Serial number 12 of the sectoral Table in Schedule I to the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 was rewritten in April 2024. A single Government route entry for satellites gave way to three tiers of space activity, each with its own route threshold and a set of definitions. Serial number 13, private security agencies, is a one-line entry that has stood unchanged since 2019. The Rules are made under clauses (aa) and (ab) of sub-section (2) of section 46 of the Foreign Exchange Management Act, 1999.
This article states the position as per the Rules notified on 17 October 2019 (S.O. 3732(E)) as amended by the notifications named in this article; the latest amendment consulted is S.O. 4870(E) dated 2 September 2026. Later amendments, press notes and sector regulators' conditions should be checked before acting. For a space or security venture with foreign capital, see our FEMA advisory service.
All three space entries carry a cap of hundred per cent. Satellites (manufacturing and operation), satellite data products, ground segment and user segment: automatic up to 74%, Government route beyond 74%. Launch vehicles and spaceports: automatic up to 49%, Government route beyond 49%. Components and systems or sub-systems for satellites, ground segment and user segment: automatic. The investee is subject to sectoral guidelines of the Department of Space. Private security agencies: 49%, Government route.
The entries after the amendment
| Serial number | Sector or activity | Sectoral cap | Entry route |
|---|---|---|---|
| 12 | Space Sector (heading) | - | - |
| 12.1 | (a) Satellites-Manufacturing and Operation; (b) Satellite Data Products; (c) Ground Segment and User Segment | Hundred per cent | Automatic up to 74%. Government route beyond 74% |
| 12.2 | (a) Launch Vehicles and associated systems or sub-systems; (b) Creation of Spaceports for launching and receiving Spacecraft | Hundred per cent | Automatic up to 49%. Government route beyond 49% |
| 12.3 | Manufacturing of components and systems or sub-systems for satellites, Ground Segment and User Segment | Hundred per cent | Automatic |
| 12.4 | The investee entity shall be subject to sectoral guidelines as issued by the Department of Space from time to time | - | - |
| 12.5 | Definitions (a) to (f) | - | - |
| 13 | Private Security Agencies | 49% | Government |
The Table prints the hundred per cent cap as a percentage figure; it is written in words throughout this article.
How the rows are printed. In the Gazette of 16 April 2024, serial number 12.1 has one cap cell and one route cell standing beside its three clauses, and serial number 12.2 has one cap cell and one route cell beside its two clauses. In each route cell the automatic line is printed first and the Government route line below it. Both lines of serial number 12.1 print 74%, and both lines of serial number 12.2 print 49%.
Which notification changed what
| Provision | Change | Notification |
|---|---|---|
| 12 (12.1 to 12.5) | Substituted as a whole | Foreign Exchange Management (Non-debt Instruments) (Third Amendment) Rules, 2024, S.O. 1722(E) dated 16 April 2024 |
| 13 | As notified on 17 October 2019 | None of the 19 amending notifications up to 2 September 2026 changes it |
S.O. 1722(E) came into force on the date of its publication in the Official Gazette. As notified in 2019, serial number 12 was headed "Satellites - Establishment and operation", subject to the sectoral guidelines of the Department of Space/ISRO, with a cap of hundred per cent under the Government route. That text is history.
Serial number 12.5: what each activity means
The definitions decide which tier an activity falls in.
(a) Satellites - Manufacturing and Operation. End-to-end manufacturing and supply of satellite or payload, establishing the satellite systems including control of in-orbit operations of the satellite and payloads.
(b) Satellite Data Products. Reception, generation or dissemination of earth observation or remote sensing satellite data and data products including Application Interfaces (API).
(c) Ground Segment and User Segment.
- Ground Segment: supply of satellite transmit or receive earth stations including earth observation data receive station, gateway, teleports, satellite Telemetry, Tracking and Command (TTC) station, and Satellite Control Centre (SCC) etc.
- User Segment: supply of user ground terminals for communicating with the satellite, which are not covered under the ground segment.
(d) Launch Vehicles and Associated Systems or Sub-systems. A vehicle and its stages or components that is designed to operate in or place spacecraft with payloads or persons, in a sub-orbital trajectory, or earth orbit or outer space.
(e) Creation of Spaceports for launching and receiving Spacecraft. A spaceport (also referred to as launch site) may be regarded as the base from which spacecraft are launched, and consists of facilities involving devices for transportation to, from and via outer space.
(f) Manufacturing of components and systems or sub-systems for satellites, Ground Segment and User Segment. Comprises the manufacturing and supply of the electrical, electronic and mechanical components, systems or sub-systems for satellites, Ground Segment and User Segment.
Reading the three tiers
| Tier | Activities | Automatic route up to | Beyond that |
|---|---|---|---|
| 12.1 | Satellites, satellite data products, ground and user segment | 74% | Government route |
| 12.2 | Launch vehicles, spaceports | 49% | Government route |
| 12.3 | Components and systems or sub-systems | The whole cap | - |
Two points on the words:
- Supply and manufacture are placed apart. "Ground Segment" in 12.1 is defined as supply of earth stations and related stations; manufacturing of components and systems for the ground segment is in 12.3.
- Launch vehicle components. Definition (d) speaks of a vehicle "and its stages or components". Serial number 12.3 names components for satellites, ground segment and user segment; it does not name launch vehicles.
Serial number 12.4 applies to all three tiers: the investee entity is subject to sectoral guidelines issued by the Department of Space from time to time. Those guidelines are named by the Table and are not set out in the Rules. The meaning of each route is in our article on automatic route and Government route.
Investors restricted by rule 6(a)
Rule 6(a), as substituted by S.O. 2174(E) dated 1 May 2026, lets a citizen of Pakistan or an entity incorporated in Pakistan invest, under the Government route, only "in sectors or activities other than defence, space, atomic energy" and prohibited sectors. Space is therefore outside what such an investor may enter. Investors covered by the land-border provisos invest only under the Government route; see who may invest and the land-border countries.
Serial number 13: private security agencies
The entry is one line: Private Security Agencies, cap 49%, entry route Government. The Table prints no "Other conditions" and no definition under it. Paragraph 3(b)(ii) of Schedule I still makes the investment subject to applicable laws or regulations, security and other conditionalities, and the Government route brings the conditions stipulated in the approval.
A worked example
Halcyon Orbital Inc, a foreign company from a country that does not share a land border with India, plans three Indian ventures.
- Tara Satellites Private Limited will build and operate small satellites. Serial number 12.1(a): Halcyon may hold up to 74% on the automatic route; a holding beyond 74% needs Government approval.
- Agni Launch Systems Private Limited will build launch vehicles. Serial number 12.2(a): automatic up to 49%; Government route beyond 49%.
- Kiran Space Components Private Limited will manufacture electronic sub-systems for satellites. Serial number 12.3: hundred per cent, automatic route.
Each company is subject to the Department of Space guidelines under serial number 12.4.
A separate investor wants 49% of Rakshak Guarding Services Private Limited, a private security agency. Serial number 13 permits up to 49% only with prior Government approval.
Need help classifying a space business?
The definitions in serial number 12.5 decide the tier, and the tier decides how far the automatic route runs. Our FEMA advisory team maps the activity to the definitions and plans the holding accordingly.
Key takeaways
- Space sector cap: hundred per cent in all three entries.
- Satellites, satellite data products, ground and user segment: automatic up to 74%, Government route beyond.
- Launch vehicles and spaceports: automatic up to 49%, Government route beyond.
- Components and systems or sub-systems for satellites, ground and user segment: automatic.
- Serial number 12 is as substituted by S.O. 1722(E) dated 16 April 2024.
- Private security agencies: 49%, Government route, as notified in 2019.
Read next
- Serial number 6 of the Table: defence
- Serial number 14 of the Table: telecom services
- Rule 6: who may invest and the land-border provisos
- FDI sectoral caps: an overview chart
Disclaimer: Based on the Gazette text of the instrument this article names, as notified and as amended by the notifications named in the article (for the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 the latest amendment consulted is S.O. 4870(E) dated 2 September 2026), as consulted on 2 October 2026. There is no official consolidated text; the provisions were read with each amendment applied. Sectoral caps, entry routes, conditions, forms and time limits change by notification, press note and circular; later changes should be checked on the Gazette, DPIIT and Reserve Bank sites. This article is general information, not legal advice; check the official text before acting.