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NEW DELHI (Reuters) - A rocket carrying the GSAT-5P communications satellite exploded seconds after lift-off from a launchpad in the country’s south on Saturday, officials said, in a potential setback for its commercial space business.

The Geosynchronous Satellite Launch Vehicle (GSLV) exploded in the first stage of the flight, leaving a trail of smoke and fire. The initial launch of the GSAT-5P satellite had been pushed back because of an engine defect.

"The performance of the (rocket) was normal up to about 50 seconds. Soon after that the vehicle developed large altitude error leading to breaking up of the vehicle," K. Radhakrishnan, head of the Indian Space Research Organisation, told reporters.

"But what caused this interruption has to be studied in detail."

India is aiming to expand its satellite launch business to about $120 million a year, which is estimated to be only a quarter of China’s present launch business.

Although India has had success with the launch of lighter satellites, it has faced problems sending up heavier payloads, hampering the growth plans of its commercial launch business.

In April, a rocket powered by a domestically built cryogenic engine used for lifting heavy payloads developed a snag and plunged into the Bay of Bengal off India’s east coast.

In 2008, India sent 10 smaller satellites into orbit from a single rocket. The same year it also dispatched its first unmanned mission to the moon.

That mission was abandoned 10 months later but not before it had sent back data with evidence of ice on the moon.