In an attempt to reassure, Dr P Pawar, a consultant at Hyderabad's sleek Apollo hospital, lowers his voice and begins to ask slowly about the pain felt by his teenage patient. Staring back at him, Lakhsmi gives hesitant answers, looking bewildered. Once Dr Pawar finishes taking his patient's history, he asks a colleague for a second opinion.

Nothing unusual in this unless you consider that between doctors and patient lies 1,000km of the Indian subcontinent. Dr Pawar and Lakhsmi are talking to images on television screens, communicating via a satellite network that links rural patients with doctors in hospitals and hi-tech research centres. In doing so, the hospital is demonstrating that India has begun to realise a core aim of its space programme: using technology to benefit the poor.

"We serve a population of 50,000 spread over 50 square kilometres in 192 villages which has no access to specialist doctors," says Suresh Shankar, the administrator of the Aragonda centre in Tamil Nadu. "This therefore is for many people the first time they can access high-quality advice."

Whether scrutinising live CT scans or ultrasound pictures, Mr Shankar says, "telemedicine" has saved patients an often arduous journey from remote rural areas. "With this technology we can tap into the doctors in Hyderabad and tap into their expertise in specialist fields such as cardiology, dermatology and neurology. They just are not found here. So far, more than 1,000 people have had consultations. And only 10% needed to travel from here to our hospitals in Hyderabad or Chennai."

Making all this possible is the work of the Indian Space Research Organisation (Isro), which provides the bandwidth on its satellites to send images and sound between hospitals on the Earth's surface.

Nearly 60 remote hospitals are now linked to 16 "super speciality" units in cities. Last month medical centres in Pakistan were connected with those in India as part of the peace process between the neighbouring countries.

Isro is a self-styled "space programme for the people", which stresses its civilian abilities and is reticent about its success, unusual in a country where the gap between reality and rhetoric is wide.

Little more than 40 years after Isro began life as a launchpad for small US-made rockets, India's national space programme has sprinted ahead of those in wealthier economies such as Israel and Malaysia. By not entering a space race with the world's superpowers, the organisation has so far resisted the temptation of prestige projects, such as manned space stations, which become white elephants in orbit.

"We are a space programme created to benefit the common man. It is not just to develop high technology for its own sake," says G Madhavan Nair, the chairman, at Isro's headquarters in Bangalore.

Keen to stress the thrifty nature of his work, Nair spouts figures and cost benefit analyses so frequently that he often sounds more like an accountant than the aeronautical engineer he is. He points out that his annual budget runs at 27.3bn rupees ($600m), a little under a 30th of Nasa's yearly spending. Despite this, India has 14 satellites in orbit with another four planned launches next year.

The country's six remote sensing satellites form one of the globe's most advanced "eyes in the skies". And, unlike space programmes in other developing countries, such as Brazil, low costs have not led to spectacular accidents. Isro has recorded half a dozen aborted take-offs in almost 40 launches.

Pictures from space have been used to find water, combat deforestation and calculate crop yields. They also made front-page news recently when an artificial lake in Tibet threatened to flood part of northwest India. Data have been used to monitor pollution and fight forest fires in Europe and the US. There are plans to join the European Union's Galileo project to produce a rival to America's global positioning satellites.

Isro has managed a degree of commercial success, with "earth observation" imaging grabbing a fifth of the world market and generating sales of some $5.5m a year.

"One of our most successful projects has been telling fisherman where the largest catches are," says Nair. "You can identify where the fish are by the colour of the ocean as seen from space. Once you relay the information, yields go up by 150-200%."

The space agency has managed another world first: launching a satellite dedicated to education, called Edusat. This "schools in the sky" project is aimed at transmitting classes and lectures around the country, and within seven years is projected to reach 37 million schoolchildren.

Isro's latest mission also saw India join an elite club of five other nations, which have proved they can place satellites in geostationary orbit. "This is how we want to demonstrate results, with each step getting a tangible result. It is not great leaps but steady progress," says Nair.

Perhaps the most ambitious launch will be the country's moon shot. Isro is planning to send a satellite, Chandrayaan I, to the moon by 2007. Question why a poor nation such as India should spend cash on such an ambitious trip and the answer is a short one.

"It's low-cost. We can do it for less than $100m," Nair says "For that we can scan the lunar terrain and get imagery of the moon's surface. We will gather vital data on the presence of minerals and gases."

If it realises its ambitions, India would become only the fifth power after the US, Russia, Japan and Europe, with this month's Smart-1 mission, to send a spacecraft to the moon.

Given that Nasa has comprehensively mapped the lunar surface, the scientific value of another mission might be considered somewhat limited. The real advance for Isro, says Mr Nair, will be deep space travel. "It is a journey of 350,000km. Right now we do just 36,000km above the Earth. We will need new control, tracking and propulsion systems for Chandrayaan. That is where the added value is."

Nair sounds more circumspect on manned space flight or a moon landing. "You can collect the data from the moon and transmit it without a human. Robots can also find minerals on the surface as well as a human."

Contrast this with China, which has already sent a man into space, plans to build a space station and is, say analysts, more military-minded. Beijing also hopes to undertake a three-stage lunar programme.

Nair is cautious in responding to the achievements of India's bigger eastern neighbour.

"It is a different set-up. You see, India is a democracy and a developing nation. The start-up costs for a manned moon mission would begin at $2bn. You need a good reason to send someone to the lunar surface for that amount of money."

This raises the question why a country like India, with a third of the world's poor, should spend hundreds of millions of dollars on a space programme at all when it could use satellites from the West. "We develop expertise which can be put to use for our own needs and do not have to rely on someone else," says M Gangrade, group director at Isro's satellite centre. Set in 40 acres of prime real estate in India's technology capital, Bangalore, the satellite-manufacturing plant is a testament to the country's ambition. In one vast hangar are spread the innards of the newest satellite, Cartosat 1, capable of seeing objects less than a metre wide. Around its black hull are masked scientists testing vital components. Engineers speak proudly of indigenously producing their satellites, but admit that many components come from abroad.

For years western experts viewed the Indian programme as a weapons proliferation and security risk, despite the Indian government's insistence that it was a civilian project. Hawks pointed out that rockets could be used to launch military payloads and that remote sensing satellites could easily be converted to spy on an enemy.

Some in India do openly call for the "militarisation" of Isro. "We could easily have an ICBM [intercontinental ballistic missile] with the technology we have developed," says Bharat Karnad, of the Centre for Policy Research in Delhi. "All we need is simple changes in the missile architecture. But the Indian government took an early decision to separate . . . [Isro] from the military. But it is about time we changed this attitude."

Attempts to stop India's entry into the space race have often backfired. In 1992 the US pressed Russia not to give Isro the technology for a cryogenic rocket, which uses frozen fuel and is seen as vital to any ambitious space programme. But last January the organisation announced successful tests of an Indian-built cryogenic engine. "You might say it is a decade late but we gained valuable insight into how the engines worked," said Mr Gangrade.

In India the space programme has become a symbol of technical prowess and self-sufficiency. Used to infuse the nation with pride at matching first-world powers in scientific fields, Isro has been feted by all the political parties as proof that India can transcend poverty. It is notable that the country's president, APJAbdul Kalam, started his career as an Isro engineer, although he made his name developing ballistic missiles.

Warming relations between Washington and Delhi are likely to accelerate Isro's development. In September the Bush administration announced it would remove Isro from a US export restriction list, which regulates sales of dual-use technologies those that can be used both for civil and military purposes.

Analysts say this decision should result in a threefold increase in hi-tech imports from the US and speed up collaboration with Boeing to build communication satellites.

The commercial imperative is plain for all to see. Nair points out that Isro pays scientists $600 a month. "That is a respectable salary in Bangalore and one that gives you a reasonable standard of living."

Although there are obvious national security concerns for the US, many say that work will be shifted from over there to India.

"I think what we are seeing is the beginning of the outsourcing of space technology," says Raja Mohan, professor of strategic affairs at Jawaharlal Nehru University, Delhi.

"What the software industry is seeing right now will happen again with Isro. The question is not if, but when."