Rocket operator Arianespace will market Indian space launchers and Astrium, an arm of the European Aeronautics Defence and Space Company, will promote Indian-made satellites, the two space giants announced at a conference last week.

Astrium also held out the first benefits of the tie-up for India, which will build two satellites, one for France-based Eutelsat and the other for Britain's Avanti, for launch by Arianespace in the next two years.

Astrium will supply some of the satellite sub-systems.

Arianespace chief executive Jean-Yves Le Gall and his Astrium counterpart Francois Auque were in Hyderabad, southern India, for a global conference that ended Friday where they praised the quality of India's space systems.

The tie-ups strengthen the partnership between Europe and India, P.S. Sastry, launch vehicles director at the Indian Space Research Organisation (ISRO), said in an interview.

They reflect "the quality, reliability and cost effectiveness of our products and services" and will bring commercial spin-offs to India's space programme, Sastry said.

The agreements mark a new stage in the space relationship between Europe and India, which stands to gain revenue for the first time from a continent that has regarded the South Asian nation more as a customer.

The relationship dates back more than 25 years when India was chosen to provide a satellite for the third qualification launch of the Ariane rocket.

Now India is seeking to reap commercial benefit from its more than 40-year-old space programme, apart from the extensive use of locally made satellites for communications, meteorology, remote sensing and disaster warning.

The country is competing for satellite customers with China as both Asian nations seek to break into a market over which the US, Europe and Canada have held sway.

Up for grabs is a slice of a satellite manufacturing and launch market estimated to grow to 145 billion dollars over 2007-2016, from 116 billion dollars in 1997-2006, according to the market research firm Euroconsult.

India launched an Italian scientific satellite for a fee in April and is due to put in orbit an Israeli spy satellite later this year. Six small foreign payloads have gone into space on a piggyback ride with India's own satellites.

Commercial revenue from the space programme has reached six billion rupees (151 million dollars), a six-fold jump in four years, said G. Madhavan Nair, chairman of the Indian Space Research Organisation (ISRO).

"The business can only grow," Nair said in Hyderabad. "The space technology we have developed is of global standards and on par with others."

Arianespace, which has performed 13 launches for India in the past 25 years, is focused on putting satellites as heavy as 10 tonnes into orbit, said Nair.

"There are customers with payloads of two to 2.5 tonnes, and small payloads of 50 kilos or 100 kilos, which they want to put in orbit," he said, adding Arianespace "will deflect such proposals" to India.

Arianespace also has an order backlog of 29 satellite launches and needs a partner that will be able to handle customers seeking low-cost service providers. India's costs are about 60 percent of what established competitors charge for launch services, space officials said.

"The Europeans are now aware that they need a partnership with India," said launch services director Sastry. "Otherwise their business will suffer in the long term."

Astrium's regional export director Ghislain de la Sayette said the twin satellite deals awarded to India were worth "many tens of million dollars."

The company will also market India's "cost-effective platforms" to other launch customers in Europe, and offer India's earth observation services to its clients in the US.

India has a packed space programme of its own, with plans for 60 outer-space missions in the next five years as it seeks advances in satellite navigation, communications, space transportation and earth observation.

That may limit the jobs it undertakes for overseas customers that may come via Arianespace and Astrium.

"There is big demand on ISRO," chairman Nair conceded. "We are committed to provide whatever is needed for national development."

The space agency expects to meet the task by "outsourcing" the manufacturing of satellite sub-systems and components to Indian companies, he said.

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