New Israeli Civil Space Policy to Boost R&D and Commercial Space Industrial Base

Abstract

Israel's space industry emerged from defense necessity, having its first launch in 1988. State budget was always low and mostly defense related, lately $76 million, of which only $3 million for the civil program administered by the Israeli Space Agency. The $3 million was highly leveraged, as 80% of the investment in space-related R&D in Israel so far came from foreign governments interested in cooperation and joint projects resulting in agreements with over 10 space agencies. Despite low budgets, achievements so far are remarkable: Israel was ranked number 1 in terms of publication per capita on aerospace engineering and has demonstrated capabilities and products in space infrastructure, products, and services, with leading optical equipment and small satellites. The space industrial base includes around 20 corporations employing 2,000–2,500 workers driving annual sales of $800 million, the eighth largest in the global space sector. Following a series of studies regarding the impact of the space industry on the Israeli economy, Israel adopted a new civil space policy, increasing civil budgets eightfold to a yearly $24 million. The goal is ambitious—with the new cash injection and capitalization on its lucrative defense, communications, and IT industries as a solid base, Israel plans on boosting its civil space industry, placing it among the top five leading nations in space, with yearly sales of $6–10 billion, representing 3–5% of the global space market. Success will make the space industry a driving force for economic growth. The lion's share of the budget will be allocated to international cooperation and projects. The two other major allocations are to industrial R&D and basic research. A key element launched by a directive promulgated in December 2012 is a targeted program by which state financial support will be provided to innovative commercial space R&D, considering mainly the novelty and uniqueness of the product/technology; their expected achievements and capacity to enhance and upgrade satellites' utility and performance; and their market. Support will amount to 50–85% of the project's budget, not exceeding $5.3 million, unless for ground-breaking projects. Considering past achievements with small budgets, this is a significant stimulus. Successful projects will pay the state royalties as a percentage from future income (3–6%), if (and only if) such is generated, until full repayment of the grant, thus having state bearing most of the project's risk.