- India's satellite will provide communication and disaster management services to most of South Asia
- Pakistan pulled out of the project amid heightened tensions between the two neighbors
New Delhi (CNN)In a first, India's space agency launched a satellite Friday to provide communications services to its neighboring countries.
The South Asia satellite, funded entirely by India, was announced several years ago with the intention of serving all eight members of the South Asian Association for Regional Cooperation (SAARC).
According to Uday Bhaskar, director of Delhi-based think tank the Society for Policy Studies, the satellite represents a "new form of regional cooperation," and Indian Prime Minister Narendra Modi has called it a "gift to the SAARC region."
"Even the sky is not the limit when it comes to regional cooperation among like-minded countries," Modi said after the launch.
The more than $36 million project does not, however, involve Pakistan, which pulled out of the project.
The satellite project comes at a time of heightened tensions between the two countries. This week, India accused Pakistan of mutilating the bodies of two of its soldiers in the disputed territory of Kashmir. Last year, militants from Pakistan killed 18 Indian soldiers in an attack on an Indian army base.
While some have suggested Pakistan may have pulled out due to espionage concerns, Ajay Lele, a senior analyst at the Delhi-based Institute for Defense Studies and Analysis said "in modern times, you do not develop a satellite to spy on a country."
But N. Sathiya Moorthy, a regional director at the Observer Research Foundation, said India should "do everything to ensure that policy makers (in Pakistan) remain convinced that it is nothing more than what India says it is."
Lele said Pakistan's backing out is a missed opportunity for Islamabad. "Problems on earth shouldn't affect relationships in outer space," he said.
Pakistan Ministry of Foreign Affairs spokesman Nafees Zakaria said the country was initially "keen to participate in the project."
"However, as India was not willing to develop the project on a collaborative basis, it was not possible for Pakistan to support it as a regional project under the umbrella of SAARC," he added.
He dismissed speculation over espionage concerns as "unfounded."