When the Drone Rules were announced in August 2021, industry players projected that India’s drone market could grow to INR 500 billion (US$6.8 billion) in the next five years. This is because India’s regulatory norms were finally aligning with global trends, and opening prospects for commercial use and participation of foreign investors.
On its part, the Civil Aviation Ministry projects that India’s drone industry could see total turnover worth INR 120 billion to 150 billion (US$1.63 billion to US$2.04 billion) by 2026 assisted by the PLI Scheme, which has a budget allocation of INR 1.2 billion (US$16.32 million) spread over three years (information on how the scheme works is covered in a later section below). Drone makers in India currently have a turnover of about INR 800 million (US$10.88 million).
At a press briefing on Thursday, September 16, the Civil Aviation Minister Jyotiraditya Scindia said, “With Drone Policy (Rules) and Drone PLI scheme, we have an aim that drone manufacturing companies in India should reach a turnover of ₹900 crore [INR 9 billion (US$122.44 million)] in the coming three years.” This will be a cumulative result of the development of a “value chain in the drone industry”, covering “hardware (drone manufacturing), software, and service delivery.”
Prior to the Drone Rules 2021, the sector saw limited funding opportunities, with B2B startups attracting the bulk of any venture capital interest and overall limited scope for innovation in the industry. In fact, compared to investment in India’s drone startups (US$16.56 million), China’s drone startups had attracted 14x more investment between 2014-18, at about US$239 million.
