With the record SpaceX IPO on June 12, Elon Musk has become the world’s first trillionaire. However, SpaceX’s most profitable vertical, Starlink, has effectively been shunted out of two of the world’s most populous countries, India and China.
Just as SpaceX was preparing for its historic listing on NASDAQ, Bloomberg reported that India had effectively frozen the approvals required for Elon Musk’s satellite internet service, Starlink, to begin commercial operations in the country.
Following the IPO, SpaceX’s valuation has already crossed US$2 trillion; however, Starlink is central to that valuation, and the company’s effective blocking from two of the world’s largest internet markets highlights risks investors might have overlooked.
Notably, Starlink is already banned in China. It is viewed by Beijing as a national security threat, and SpaceX has not been given a license to operate in the country.
In fact, even foreign ships are mandated to stop using Starlink terminals once they enter Chinese waters. In December last year, China issued its first penalty to an unidentified foreign-owned ship for illegally using Starlink services while in Chinese waters.
The shunting out of Starlink from two of the world’s biggest internet markets due to security risks underscores that many more countries could block Starlink from operating within their borders in the future.
Why India Blocked Starlink?
The Indian security agencies under the Ministry of Home Affairs have withheld the final clearances needed for Starlink’s launch. Notably, the Starlink clearance has been blocked despite Starlink obtaining a Global Mobile Personal Communication by Satellite (GMPCS) license in India nearly a year ago.
That license allowed the company to prepare for operations and enter into commercial agreements, but it did not constitute final approval to begin services, Bloomberg reported, citing people familiar with the matter.
Starlink has even conducted security demonstrations before telecom authorities; however, Indian authorities reportedly sought additional clarifications and compliance measures.
The final decision to block Starlink’s entry into commercial satellite internet service was taken after the company’s controversial role in the recent Iran war.
However, Starlink has rejected the report, highlighting its ongoing engagement with Indian government authorities.
“Starlink remains in active and productive discussions with the government of India, contrary to misleading stories based upon unsubstantiated claims from anonymous sources,” Lauren Dreyer, vice-president, Starlink Business Operations, said on social media platform X.
“To align with India’s sovereign technology, regulatory and security requirements, Starlink has setup a bespoke deployment model for India that further demonstrates our commitment to working within India’s strategic framework.”
Starlink remains in active and productive discussions with the Government of India contrary to misleading stories based upon unsubstantiated claims from anonymous sources.
We have worked with the Government through all of the required regulatory and compliance processes in a… https://t.co/BQdcDHmPaf— Lauren Dreyer (@LaurenDreyer) June 9, 2026
Starlink’s blockage from the Indian market could impact the company’s finances and future growth prospects.
“If India delays or freezes the license, Starlink could lose access to almost 40% of the world’s population. The revenue narrative, which is subsidizing the Space Exploration and other AI build-outs, will be impacted in the eyes of investors,” said Neil Shah, the co-founder and research vice president at Counterpoint Research, on social media platform X.
“For a country like India, with highly sensitive, contested borders … the threat of unmonitored, untraceable satellite terminals operating on its soil outside the purview of domestic intelligence agencies is an absolute red line,” he continued.
Security Risks Associated With Starlink
Starlink terminals were reportedly used in Iran by dissidents and agents of foreign governments during the recent war, despite the service not being licensed in Iran.
According to Bloomberg, there were nearly 50,000 smuggled Starlink terminals operating illegally in Iran at the beginning of this year.
During the January 2026 protests, when Iranian authorities blacked out internet services, Starlink became the de facto link for the protesters to the outside world.
Iran even filed formal complaints with the International Telecommunication Union (ITU), alleging that Starlink was violating Iranian sovereignty as it lacked a license to operate in the country.
The ITU Board noted with concern that while Starlink had the capability to block illegal terminals en masse, it chose not to do so in Iran.
This has raised concerns in India about the government’s capability to exert control over a US-based communications provider during periods of geopolitical tensions.
Further, Starlink’s global operations and SpaceX’s critical dependence on the US government contracts for its finances add additional risks.
SpaceX depends on US government contracts and regulatory approvals for its commercial and national security launches, its spectrum allocations, and its orbital licensing.
SpaceX will also play a key role in President Trump’s ambitious Golden Dome project, which involves building hundreds, possibly thousands, of ground- and space-based sensors and missile interceptors to provide the US with a missile defense shield.
Approximately 20% of SpaceX’s revenue comes from US government contracts, according to the company’s 2026 IPO filing.
This gives the US government considerable leverage over Musk and SpaceX.
In a scenario where US strategic interests collide with India, Washington could pressure SpaceX to share data from Starlink’s Indian operations, maintain or deny coverage over specific regions, or otherwise act in ways that serve American rather than Indian interests.
Critics fear that during periods of geopolitical tension, Starlink could act independently and contrary to India’s national security interests.
A key security risk is that Starlink, as a US-controlled system, could potentially disrupt or disable service in regions where the Indian government needs uninterrupted connectivity, e.g., during disasters or military operations, while being unable or unwilling to fully block service in sensitive or restricted areas where New Delhi wants it shut down, such as border zones, conflict areas, or regions with insurgent activity.
Terrorists in border areas and insurgents such as Left-Wing extremists could theoretically access Starlink services and use them to launch attacks on Indian security forces.
In fact, in December 2024, Indian security agencies recovered Starlink equipment from a militant group in Manipur. Musk’s reply on X was simply: “This is false. Starlink satellite beams are turned off over India.”
Further, India has a long maritime boundary, where Starlink connectivity could aid smugglers.
In the same month, drug smugglers in India’s remote but strategic Andaman and Nicobar Islands were found to be using Starlink internet services for navigating the deep seas.
Indian authorities sought usage history details from Starlink, but the company declined, citing privacy laws.
“The primary risk with Starlink is the limits it places on the Government of India’s ability to manage its availability. Starlink services may remain illegally active when the Government wants them to be halted in an area. Conversely, Starlink services may be halted when the Government needs them to be operational,” said the Takshila Foundation in a research paper earlier this year.
Again, due to Starlink’s global operations and commercial interests, it is doubtful which country it will support in times of military conflicts.
“Starlink will need to guarantee compliance with Indian security requirements when a foreign government might make conflicting demands or looks to have probes in the network and could directly violate India’s data laws,” Shah noted.
The US unreliability under President Donald Trump is another concern.
“Indian officials reportedly believe that Starlink operates at the pleasure of the US President, irrespective of the wishes of the licensing country,” Indian defense analyst Vijainder K Thakur wrote on X.
“Even if India were to authorize Starlink, the US government could still pressure Elon Musk to suspend the service during hostilities with Pakistan or even China.”
An additional risk is that Starlink may leverage its users’ sensitive data for intelligence purposes or to gain a commercial advantage.
This risk escalated earlier this year when Starlink updated its Global Privacy Policy to explicitly allow the use of customer data, including precise location information, IP addresses, and “communication information” (such as audio, electronic, or visual data), for training its machine learning and artificial intelligence models.
The policy also allows sharing data with “third-party collaborators” for AI training.
Meanwhile, SpaceX has already merged with xAI, Musl’s Artificial Intelligence company that operates and develops the Grok chatbox.
So, in principle, Grok now has access to all information, data, and communication routed through Starlink.
Further, under Section 702 of the Foreign Intelligence Surveillance Act (FISA), all US internet service providers are required to share information, such as emails, texts, voice and video calls, with US intelligence agencies, provided that the targets are neither US citizens nor based in the US.
Total dependence on Starlink carries other risks, as highlighted by the company’s conduct during the Ukraine War.
Starlink’s Flip-Flops in the Ukraine War
Starlink began offering its services in Ukraine in February 2022, following the outbreak of hostilities with Russia. Ukraine soon became heavily dependent on Starlink for government and military communications.
Despite this, Musk reportedly “restricted Starlink access multiple times” employing geofencing (remotely restricting service based on geographic location).
He also “denied the Ukrainian military’s request to turn on Starlink near Crimea,” directly impacting its military operations.
Musk himself acknowledged that he refused a Ukrainian request to activate his Starlink satellite network in Crimea’s port city of Sevastopol to aid an attack on Russia’s fleet there, saying he feared complicity in a “major” act of war.
On September 8, 2023, Musk wrote on Platform X: “There was an emergency request from government authorities to activate Starlink all the way to Sevastopol. The obvious intent was to sink most of the Russian fleet at anchor. If I had agreed to their request, then SpaceX would be explicitly complicit in a major act of war and conflict escalation.”
Musk’s decision not to provide Starlink connectivity resulted in the failure of Ukraine’s audacious offensive in Crimea.
In 2025, he boasted that “my Starlink system is the backbone of the Ukrainian army. Their entire front line would collapse if I turned it off.”
Again, in February last year, Ukraine was warned that it would face the imminent shutdown of Starlink service if it did not reach a deal on rare earth minerals soon.
The incident highlighted how Starlink access could be weaponized to arm-twist a country in auctioning its national resources while it is fighting an existential battle and has no alternative to Starlink services.
While SpaceX’s record IPO has made Musk the world’s first trillionaire, Starlink’s effective ban from India and China, driven by deep national security and sovereignty concerns, exposes major risks to its growth and valuation.
- Sumit Ahlawat has over a decade of experience in news media. He has worked with Press Trust of India, Times Now, Zee News, Economic Times, and Microsoft News. He holds a Master’s Degree in International Media and Modern History from the University of Sheffield, UK.
- He can be reached at ahlawat.sumit85 (at) gmail.com
