Monday, January 30, 2023

What India's drone industry is expecting from Nirmala Sitharaman's Budget this time

The global drone market is poised to become a US$ 54 billion market by 2025, estimates indicate that the drone manufacturing potential in India could be worth US$ 4.2 Billion by 2025, growing to US$ 23 billion by 2030, contributing to the country’s target of a US$ 5 trillion economy . The Government’s ‘Aatmanirbhar Bharat’ (Make-in-India) drive is going all out to support domestic enterprises by fine-tuning policies and regulations so that more and more products are manufactured within the country. 

One of the main sectors which are getting a lot of support and thrust from the government is the manufacturing of drones or unmanned aerial vehicles (UAV). As the government shows its clear intent to make India a global hub for the manufacturing of drones by 2030, the growth of this sector is immensely strong. As we are coming close to 2022, it is worthwhile to take a stock of the fledgling drone industry in India and undertake some crystal-ball gazing into the near future.

The Drone Shakti initiative, rolled out during Budget 2022, aimed to promote and facilitate drones as a service through start-ups. This initiative, along with the government's Production-Linked Incentive (PLI) scheme for drones, was expected to increase domestic manufacturing and create employment. Such initiatives go to a large extent in hand holding fledgling industries in the nation. Given its potential, the support of the government for manufacturing of drones came at the right time, in sync with a comprehensive push at regulation.

The Drone Rules (September 2021) , which superseded the Unmanned Aircraft System (UAS) rules of March 2021, were meant to simplify and ease the process of the adoption of drones. In line with the intent, the Drone Rules dispensed with the requirements of geo-fencing, no permission no take-off, and real-time tracking. These requirements might be incorporated in the future, once drone manufacturing in India stabilizes.

The establishment of an inter-ministerial committee on drones, one of the pending recommendations with the government from the FICCI seminar on making India a global drone hub, would go a long way in coordination and smoothening issues.

30/01/23 Akshya Singhal/Economic Times

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