The Indian Space Research Organisation (ISRO) plans to launch a manned mission to space in 2016.
ISRO chairman K Radhakrishnan was quoted by the BBC as saying that they will design and develop the space module for the manned mission in the next four years.
The $2.6bn mission will involve selecting and training two astronauts for the programme.
At present, the space agency is building a full-scale astronaut training facility in Bangalore, according to the BBC.