IP Strategy for India's Space-Tech Suppliers

Introduction : The old model of operating in India's space industry meant if one wanted to work in the industry there was actually only one possible employer - ISRO. But times are changing. Indian Space Policy 2023 brought changes opening the market for private enterprises for manufacturing of propellant tanks, payload development, satellite integration, guidance and control algorithms, software of the ground segment, activities that before were reserved solely for the state-owned enterprises. The one thing which most of these new suppliers are failing to understand however is the fact that the actual asset they possess is not the hardware itself, but the patent protecting the former, the software driving it and the know-how creating the hardware in the first place.

Unfortunately, in the case of India's space technology industry, Indian legislation has not yet been updated in order to cover these issues. Even though the policy in the previous paragraph opens the market it does not mention in any shape or form the question of the ownership of intellectual property rights over the technologies developed in such a market. This blog is going to try to identify the gap in the policy and to suggest possible solutions to that problem. First, we will start with patents which due to section 3(k)'s exclusion of computer programs "per se" cannot receive the proper protection. Then, we will move on to know-how which is not usually included in patents and is necessary for manufacturing, testing and calibration of the components and ask what kind of legal instrument can protect it, given the absence of a separate trade secret regulation in India. Then, we will talk about the export control which in most of the cases determines with whom the discussion on the controlled component can even take place.

Last but not least, we will touch upon the government contracting which nowadays is certainly the biggest grey area of India's space law. Once again, the problem of ownership of improvements on the technology developed during execution of the mission remains unclear. Even the newly enacted 2023 Policy has no answer to that question. Therefore, the only document regulating this question is the contract through which the mission was conducted. In other words, we are observing here an industry that develops much faster than the law regulating it can. It results in application of the general purpose statutes to space technology, which certainly was not the aim of the legislation. Added to this fact that the policy that opened the market itself failed to address one particular issue – the ownership of technologies developed in the market.

Legal Provisions

Section 2(1)(j) of the Patents Act, 1970 establishes the basic test of the requirements of novelty, an inventive step and utility for all inventions, including those concerning propulsion systems and/or any other space hardware. However, Section 3(k) makes algorithms and 'computer programmes per se' non-patentable. This is applicable to flight software and guidance systems that cannot be patented. Also, Section 39 does not allow an Indian national to file a patent application abroad without the prior Controller's approval if the invention was created in India and relevant for export control purposes. Section 35 provides the Controller with powers to issue secrecy directions in relation to the inventions having certain defence implications to prevent their publication, and is therefore pertinent to any dual-use inventions.

Section 13(1) of the Copyright Act, 1957 automatically protects the source code and technical drawings upon creation, so that no registration is required in this case. Section 2(d)(vi) is also important for computer-generated works, i.e. simulations in this case, as the term authorship is defined in this section as a person causing a work to be created. Sections 51 and 52 concern infringement and fair-dealing, the former being interpreted broadly while the latter is interpreted narrowly especially when technical material is in question.

The FTDR Act, 1992 allows DGFT to regulate and even prohibit export of goods, technology and technical data. That's where the list of SCOMET (Strategic Commodities for Export Monitoring and Tracking) comes into play. The list is included in the ITC-HS Schedule 2 and Chapter IVA of the Foreign Trade Policy and covers not only tangible goods but also designs and know-how. It corresponds to India's obligations under MTCR and Wassenaar Arrangement. Importantly, the 2025 amendments extend the list in terms of quantum computing, cryogenic electronics, semiconductors and additive manufacturing technologies - all relevant to a propulsion system or a satellite producer.

As for the policy aspects, the Indian Space Policy 2023 (approved by the cabinet on 6 April 2023) and the 2024 Norms following it are executive policies, not statutes. These documents change the role of ISRO in research and development, transfer commercialisation activities to NSIL, and create IN-SPACe as a licensing agency for private players. Neither of these policies touches upon IP ownership issue that has been left unresolved since at least 2009 and remains unresolved, which means that IP ownership will be settled exclusively by contract.

Finally, with regard to international commitments of India, the Outer Space Treaty, 1967 and the Liability Convention, 1972 address state responsibility and liability. While these treaties do not deal with IP, they affect mission contract development, as the state considers risk allocation with the private party.

Legal analysis

Section 3(k) of Indian Patents Act disallows patents for computer software including flight-control and guidance systems. As was stated in Ferid Allani v. Union of India (2019), the lack of the software patent does not mean automatic exclusion of it if there is a "technical effect." Therefore, algorithm can be classified as abstract, whereas algorithm implemented together with certain sensor hardware that showed improvements is likely to pass this criteria.

Another possible pitfall is that sections 35 and 39 of the Indian Patents Act, designed for the defence era and intended to ensure secrecy of technologies, remain in force and apply to the private space activity. Filing patent application is considered a risky action because it enables 18 months publication and, hence, becomes a SCOMET issue. Accordingly, the classification with respect to SCOMET should be done before filing of the patent.

Intellectual property created in the course of joint activities with the government is not regulated at all. Although in 2017 Draft Space Activities Bill proposed to give all space IP to the government, the provision has been withdrawn. That means, all the rest should be specified in the contract including background/foreground IP list and reversion/government usage clause to protect the IP owner from losing the ownership.

In India trade secrets are protected under the common law, there is no specific legislation on the matter. John Richard Brady v. Chemical Process Equipments (1987) was a landmark case when information exchange confidentiality was enforced even without contractual clause. However, due to the mobility of engineers in ISRO, NSIL and other Indian space companies, this measure is not enough.

Finally, the case of Devas v. Antrix is a good example of difficulties that may arise in case of contracting with a government-connected organization. Antrix was exited from satellite project under the pretext of governmental interests, and in an international commercial arbitration tribunal the judgment was made in favor of Devas and $562.5 m compensation was awarded. Now there is litigation in various jurisdictions and the judgment of 2025 US Supreme Court is expected. The case does not cover IP but shows how complicated it is to exit from the contract with a government-connected entity and how important pre-contractual reversion clauses are.

Case laws

A case law example of India pertaining to the topic in question is Garware Wall Ropes Ltd. v. A.I. Chopra, Engineers & Contractors and Konkan Railway Corporation Ltd., 2009 (111) Bom LR 479 (Bombay High Court). The point is that in the above case, the patentee Garware Wall Ropes sought an injunction against the contractor who had been manufacturing and supplying the patented systems of Garware Wall Ropes to Konkan Railway, a government undertaking, on the basis of the contract executed by the President of India; the contractor appealed that he was protected by the government-use exemption of Section 47 of the Patents Act, nevertheless, the Bombay High Court ruled that though "the government's own use" described in Section 47 is less broad than "use for purposes of government" in Section 100, but nevertheless, according to Section 100, such use will require the written authorization of the government and payment of adequate remuneration to the patentee under Section 100(3), and Section 156 clearly states that a patent binds the Government in the same way as it binds anyone else.

This example is highly relevant to your space tech IP topic, since it is one of the closest precedents of India with regard to the problem mentioned in your Beyond Elevation source concerning weakening patent rights of the startups via government contracts (Indian equivalent of Bayh-Dole march-in/unlimited rights issue); the point is that it proves that in case of the space startup's patented system being supplied/utilized by the government space-related company (ISRO/Antrix/IN-SPACE) via the contract, the government use exemption is not enough to provide a complete immunity to the government entity and the startup is entitled to get the written authorization and receive the royalties, provided that the contract will be drafted accordingly; thus, it becomes a logical fourth pillar after Ferid Allani (patent eligibility of technical software), Brady (trade secret protection of confidential know-how), and Devas v. Antrix (litigation risks in government-linked space contracts), since it deals with the statutory limitations on the government use of the patented inventions.

Practical implications

• 2023 policy does not provide any definition of IP ownership, hence suppliers have to ensure that the background IP, foreground IP and further improvements will be included in each and every ISRO and NSIL contract before signing.
• The possibility to patent an algorithm separately from the hardware is not available in the Indian legislation, hence claims should be linked to the hardware and its technical value, and patent applications have to be filed prior to any publication. It is of crucial importance in case of the flight software and guidance algorithms, because otherwise there is a low probability that they will be granted a patent, unless they solve a specific technical problem and do not constitute a separate mathematical solution.
• Prior to the filing of the patent application, the suppliers have to check whether their invention is compatible with the SCOMET export control list, because the patenting of the invention will reveal its secrets, and the list is constantly revised, thus its review should be done on regular basis. It has become even more important recently, due to the 2025 revision of SCOMET that added quantum computing, cryogenic electronics and additive manufacturing to its scope, thus certain components that could have been filed earlier need a new clearance.
• There is no Indian trade secrets act, thus suppliers have to depend on NDA and confidentiality agreements, rather than on legal precedents, because of frequent switching between ISRO, NSIL and private companies among engineers.
• It would be reasonable for the companies to file patents, trademarks, and copyrights not once but on a regular basis since IP rights discipline is the only way to protect these suppliers until the creation of a Space Activities Act.

Conclusion

In the Indian space industry, the law has been lagging behind. The 2023 Policy allowed inviting private companies to become involved in the development of space but has not taken into account the one and only problem – the owner of the product under development. Thus, all the IP rights issues have become regulated by general laws and contracts which are far from the ability to regulate IP rights of the space industry. Section 3(k) does not allow the patenting of flight software unless claims are linked to hardware and technical advancement; the SCOMET controls to whom the supplier may communicate about the controlled component; there is no special law that regulates the matter of trade secrets where confidentiality depends on equity and NDAs, and not legislation; at last, the Garware Wall Ropes case and the Devas-Antrix case are good examples of how easily the government can restrict the IP rights of the contractor in case if the relevant provisions were not included at the very beginning. In other words, until the specialized Space Activities Act will plug all these legislative gaps, the contract will remain the only way of protection, and thus, it is the suppliers with no IP strategy who are most likely to lose their IP rights.

Author :- Shailey Sharma, in case of any query, contact us at Global Patent Filing or write back us via email at support@globalpatentfiling.com.

References

1. The Patents Act, No. 39 of 1970, section 2(1)(j), 3(k), 35, 39 (India).
2. The Copyright Act, No. 14 of 1957, section 2(d)(vi), 13(1), 51, 52 (India).
3. The Foreign Trade (Development and Regulation) Act, No. 22 of 1992 (India).
4. Foreign Trade Policy 2023, ch. 10 & Appendix 3 to Schedule 2, ITC (HS) Classification of Export and Import Items (SCOMET List) (Directorate General of Foreign Trade).
5. DGFT Notification No. 31/2025-26, Revision to the SCOMET List under Appendix-3 of Schedule-II (Export Policy) of ITC(HS) 2022 (2025).
6. Indian Space Policy 2023 (cleared by the Union Cabinet on 6 April 2023) (Department of Space).
7. Guidelines for the Implementation of Indian Space Policy 2023 (Department of Space, 2024).
8. Shivnesh Kumar Singh et al., Patents in Orbit: Reimagining Intellectual Property for India’s Space
9. https://beyondelevation.com/blog/posts/ip-strategy-space-aerospace-startups/ 
10. https://ijlmh.com/article/view/opening-the-market-closing-the-mind-analysing-indias-space-policy-2023-from-an-intellectual-property-perspective 
11. https://www.lakshmisri.com/newsroom/archives/government-use-of-patented-inventions/ 
12. https://www.casemine.com/judgement/in/56ea78c1607dba369a6f0154 
13. https://www.iiprd.com/patents-in-orbit-reimagining-intellectual-property-for-indias-space-future/