India’s Drone Tech Ecosystem: A Focus on Key Areas for Advancement

Summary

India’s development in the drone tech ecosystem requires emphasis on five critical areas: propulsion systems, battery technology, semiconductor-driven sensors, flight software, and advanced materials. Creating simplified drone certification sandboxes for non-defence purposes and establishing state-level single-window systems could significantly reduce compliance costs. The government must streamline policies, support research and development initiatives, and serve as an anchor buyer to further enhance the drone tech ecosystem.

The Growing Use of Drones in India

The application of drones in India has broadened immensely, spanning from recreational use to vital roles in agriculture and defence. Despite this expansion, the country’s manufacturing largely depends on imported components, creating a disconnect between the potential and the actual performance of the drone sector.

The government has taken steps such as implementing an import ban and initiating the production-linked incentive (PLI) scheme aimed at promoting local manufacturing to achieve self-reliance. However, significant challenges remain, including fragmented supply chains, dependence on imports for critical components, insufficient research and development funding, protracted processes, and persistent perceptions on quality.

Fixing India’s Fragmented Drone Supply Chain

India’s journey into drone manufacturing must begin by addressing its fragmented supply chains. The original PLI scheme, while ambitious, failed to tackle grassroots challenges. For instance, sourcing fundamental components like motor controllers and carbon-fibre composites can be time-consuming. Many micro, small, and medium enterprises (MSMEs), lacking assured demand, are hesitant to invest in niche areas such as aerospace manufacturing.

Nevertheless, the revised scheme, designed with streamlined processes and a focus on supplier networks, holds promise. By encouraging anchor manufacturers to mentor MSMEs, the sector could replicate the success seen in the mobile industry. If implemented on a national scale, this model could significantly support the “Make in India” initiative.

Another pressing concern is the continued reliance on imported subsystems. Although the ban on finished drone imports introduced in 2022 has had some impact, critical components like lithium batteries, sensors, and flight controllers still come from abroad, particularly China. Hence, it is crucial to create an indigenous system that promotes self-reliance.

To facilitate this, India should focus on propulsion systems, battery technology—potentially partnering with ISRO for space-grade solutions—semiconductor-driven sensors, local flight software development, and advanced materials like carbon fibre. The EY-FICCI report forecasts a market of INR 2,300 Cr by 2030, contingent on this strategic pivot.

Bridging the Research and Development Gap

Equally important is addressing the research and development divide. Institutions like CSIR-NAL provide necessary testing infrastructure, yet a cooperative effort between academia and industry is needed. Academic institutions can foster innovation while industry participants bring indigenous scientific advancements to life, creating drones that can compete globally.

To harness this potential, initiatives such as the establishment of a national R&D cluster or a “Drone Valley,” similar to Hyderabad’s Pharma City, should be pursued, complemented by tax incentives for intellectual property (IP) generation and collaborations with the government to address sector-specific challenges, like optimising crop-spraying drones for Indian agriculture.

India’s drone supply chain also faces regulatory uncertainties around certifications, which can delay production. Enhancing self-reliance requires a streamlined approval process through unified digital platforms and support for domestic manufacturing, which could include grants for material innovation and tax rebates for private sector collaborations.

Bureaucratic processes must be simplified to enable innovation. For startups, lengthy certification processes from application to final tests can hinder growth. Creating simple certification sandboxes for non-defence applications and state-level single-window systems, like the trailblazing model in Gujarat, could drastically reduce compliance costs. Additionally, defence contracts should prioritise startups in niche technology procurement.

Finally, efforts should focus on dispelling the notion that ‘Made in India’ drones lack quality. Establishing industry standards, adopting ASTM International guidelines, creating a “Drone Mark” certification, and showcasing Indian-produced drones at international events (such as logistics corridors in Dubai) can help rebuild confidence.