0443 GMT January 28, 2020
The cabinet's nod for the almost $1.28 billion program came nearly five months after Prime Minister Narendra Modi announced the project in his Independence Day speech, economictimes.indiatimes.com reported.
He had said the mission would be undertaken by 2022.
On completing the mission, India would become the fourth country to put a human in space using its own space program after Russia, the US and China.
India has already inked agreements with Russia and France for assistance on the mission.
The first human space flight demonstration is targeted to be completed within 40 months from the date of sanction.
Prior to this, two unmanned flights in full complement will be carried out to gain confidence on the technology and mission management aspects, according to a government statement.
The Indian Space Research Organization (ISRO) has developed and demonstrated most of the baseline technologies essential for undertaking human spaceflight mission.
The program will establish a broader framework for collaboration between ISRO, academia, industry, national agencies and other scientific organizations, it said.
The project is expected to generate employment and train human resources in advanced technologies.
It will inspire large number of young students to take up science and technology careers for national development.
The program is expected to spur research and development within the country in niche science and technology domains.
Huge potential for technology spinoffs in areas such as medicine, agriculture, industrial safety, pollution, waste management, water and food resource management are also expected.