Hardly 40-60 kilometres away from India’s iconic launch pad at Sriharikota, Andhra Pradesh is gearing up to develop a ₹25,000 crore space city spread across Sri Sathya Sai and Tirupati to create an ecosystem for India’s upcoming private-sector space technology startups and micro, small and medium enterprises (MSMEs).
Astrobase Space Technologies’ upcoming unit at Thimmasamudramin Sri Sathya Sai district of Andhra Pradesh.
“The state wants vertical and horizontal integration, which means bringing component suppliers for rocket makers into one ecosystem. Most of those suppliers are MSMEs,” said Nara Lokesh, Minister for HRD, IT, Electronics and Communications, Andhra Pradesh. He added that incentives alone don’t build an ecosystem: Speed is Andhra Pradesh’s edge, along with centres of excellence for testing and certification. Interestingly, early this year, Andhra Pradesh and Karnataka had a public tug-of-war after Lokesh invited space-tech startup Pixxel co-founder Kshitij Khandelwal, who was struggling to find land in Karnataka, to set up his unit in Andhra Pradesh. According to government sources, Andhra Pradesh is already way ahead of its rivals in building a space ecosystem.
Take the case of Astrobase Space Technologies. The company last week proposed an ₹800 crore investment to expand its commercial rocket-engine test facility at Thimmasamudram in Sri Sathya Sai district. It is expanding its rocket-testing infrastructure to approximately 360 acres by adding 339 acres to its existing facility in Andhra Pradesh. The significant scale-up will strengthen the company’s capabilities across critical stages of launch vehicle development, testing and validation, with a strong focus on advancing next-generation reusable launch vehicle technologies. It also promises 500 direct jobs by December 2030.
“At Astrobase, we are working towards building the capability to transport 1,000 tonnes of payload to space annually from Indian soil. We are committed to contributing to India’s space ambitions by developing advanced launch systems and building the capabilities that can position the country as a leading force in the global space transportation ecosystem. Andhra Pradesh will be an important partner in advancing this vision,” said Neeraj Khandelwal, chief executive officer of the company, after signing the deal last week. As part of the proposed expansion, Astrobase will add 339 acres to its existing approximately 22-acre rocket-engine testing facility, taking the total facility footprint to approximately 360 acres.
A short drive away, at Lepakshi, Bellatrix Aerospace plans an advanced programmes centre for satellites and propulsion. The project is worth ₹550 crore on 120 acres, with 565 jobs by December 2030.
Chennai-based Agnikul Cosmos, which made history in May 2024 by lifting off its Agnibaan SOrTeD mission from India’s first privately operated launchpad at Sriharikota, is also planning to set up a ₹510 crore facility for rocket launches and orbital data centre manufacturing in the space city. “This will be one of the first such dedicated manufacturing units in Asia or Europe to build orbital data centre units,” said Srinath Ravichandran, co-founder and chief executive officer of Agnikul.
In Tirupati district, Hathor Rockets will set up a rocket-engine manufacturing, testing and R&D facility at Routhusuramala. The ₹250 crore project on 100 acres covers liquid engines for launch vehicles, in-space mobility and strategic defence, with 200 jobs by December 2031.
The new projects join Skyroot Aerospace, an earlier anchor at the state’s AP Space City in Tirupati, where the state has allotted 294.67 acres for a ₹400 crore investment. “Put together, the map is compact. Engines get built near Tirupati, tested and checked for reuse at Thimmasamudram, and propulsion systems get developed at Lepakshi. All of it sits on the Hyderabad–Bengaluru corridor and within reach of Sriharikota,” a government source said.
The state was one of the first in India to have a dedicated space policy through Andhra Pradesh Space Policy 4.0 (2025–30), which aims to draw ₹25,000 crore into the sector and backs it with a ₹100 crore SpaceTech Fund.
