SW-MW Imaging Infrared Spectrometer, the Hyperspectral optical imaging instrument is envisaged to map geomorphology and mineralogy of lunar surface. The instrument is designed to image the electro-magnetic energy emanating from moon’s surface with high spectral and spatial resolution for the mission duration from an altitude of 100 km. It is designed to cover 0.8 to 5 μm in 250 spectral bands with GSD 80m and swath 20km. Primarily, there are three basic optical segments in the spectrometer. They are fore optics, dispersing element and focusing elements. The payload is designed around a custom developed multi-blaze convex grating optimized for system throughput. The considerations for optimization are lunar radiation, instrument background, optical throughput, and detector sensitivity. HgCdTe (cooled using a rotary stirling cooler) based detector array (500x256 elements, 30μm) is being custom developed for the spectrometer. Stray light background flux is minimized using a multi-band filter cooled to cryogenic temperature. Mechanical system realization is being performed considering requirements such as structural, opto-mechanical, thermal, and alignment. The entire EOM is planned to be maintained at ~240K to reduce and control instrument background. Al based mirror, grating, and EOM housing is being developed to maintain structural requirements along with opto- mechanical and thermal. Multi-tier radiative isolation and multi-stage radiative cooling approach is selected for maintaining the EOM temperature. EOM along with precision electronics packages are planned to be placed on the outer and inner side of Anti-sun side (ASS) deck. Power and Cooler drive electronics packages are planned to be placed on bottom side of ASS panel. Cooler drive electronics is being custom developed to maintain the detector temperature within 100mK during the imaging phase. Low noise detector electronics development is critical for maintaining the NETD requirements at different target temperatures. Subsequent segments of the paper bring out system design aspects and trade-off analyses.