Favorable government policies strengthen India’s drone ecosystem

New policies, import bans, and incentives for domestic production will strengthen India’s drone ecosystem. To reach the government’s goal of becoming a global drone hub by 2030, India needs to focus on innovation and the turmoil of technology.

The Government of India introduced the Drone Regulations in 2021 and revoked the Unmanned Aerial Vehicle Systems (UAS) Regulations in March 2021 to ease the over-licensing and permit restriction requirements. Liberalized rules have significantly reduced paperwork and related fees, making it easier for users to buy and operate drones. The government also allows testing beyond line-of-sight (BVLOS) operations that may help deliver drones.

Strong government policies drive market growth

Similarly, Himachal Pradesh has declared that under the 2022 Drone Policy, it intends to provide incentives to drone manufacturers and support their design, development and service. This policy aims to reduce business costs and promote innovation and R & D. The state also aims to promote startups under startup policies.

To drive production, in September 2021, the central government introduced production-linked incentives (PLIs) on drones and their components, providing $ 16 million as an incentive for manufacturers to attract investment from global brands. Did.

In February 2022, the government banned the import of foreign-made drones to increase the number of Indian-made drones. In addition, Union Budget 2022 emphasized the use of drones, and Kisan Drones and Drone Shakti promoted pilot certification in the agricultural sector. In addition, the government launched “NITIA ayog: Experience Studio on Drones” in May 2022 to support innovation. These initiatives open up markets for investment and innovation.

Improved employment, investment, and transactions are underpinned by relaxed drone policies

Following the reforms in India, corporate sentiment has improved since January 2022. In May 2022, Adani Defense and Aerospace acquired a 50% stake in General Aeronautics, an agricultural drone startup, expanding its capabilities in commercial drones. NeoSkyIndia, a subsidiary of Rattan India Enterprises, a consumer microdrone business, has acquired a 60% stake in manufacturing startup Throttle Aerospace System to provide a full-stack solution.

As the industry becomes more prominent in India, private equity companies are confident in it. In May 2022, DroneAcharya Aerial Innovations raised $ 4.6 million in pre-seed funding from capital markets and influential figures. In April 2022, drone maker ideaForge Technology raised $ 20 million for R & D, global and team expansion in Series B funding led by private equity firm Florintree.

Thanks to the lucrative financial potential of the Indian market, manufacturers such as Omnipresent Robot Tech and ideaForge are planning to double the number of employees. India’s current Minister of Aviation believes that the drone services sector will promote 100,000 (10,000 rupees) employment over the next four to five years. These sentiments enhance business confidence and market growth.

India needs to close the output gap

The disruption of the supply chain due to the pandemic and the ongoing Russia-Ukraine War has forced countries to emphasize their supply chains to mitigate operational risk. In terms of hardware, the Government of India’s promotion of local production will help companies reduce their reliance on imports. India can also use its capabilities in avionics, specialty manufacturing, and materials engineering to gain a foothold in drone manufacturing.

In terms of software, India needs to focus on delivering industry-specific applications given its capabilities in the IT and ITeS sectors. India also needs to emphasize the turmoil of innovation and technology given its strong startup ecosystem. In addition, the safety concerns posed by Chinese-made drones put India in an advantageous position. This is reflected in the increase in UAV export orders.

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