The Dawn of Drones: Surging Growth of Drone Industry in India

Drones or Unmanned Aerial Vehicles (UAVs), aircrafts that don’t require human pilots, have a history of over two centuries. 

When we think of UAVs, hot-air balloons are typically not taken into consideration. However, from a technical point of view, hot-air balloons were the first-ever aircraft to fly without a human pilot. According to this thought, the first ever UAV is considered to be a hot-air balloon, publicly hosted by Joseph-Michel and Jacques-Étienne Montgolfier in Annonay, France, in 1783. 

1849 marked the first-ever Military use of UAV, with the first pilotless vehicle developed during the end of the First World War. The technology was further developed after the Second World War, with its usage continuing to be predominantly focused on warfare by the military. 

It was towards the end of the 20th century that flying RC aircraft as a hobby grew substantially, with governments and large corporations exploring non-military commercial applications of the technology. 

Sci-Fi Becoming a Reality 

The technology reached its inflection in 2013 with Amazon’s announcement to experiment with drone deliveries. It’s been over a decade since, but Jeff Bezos's promise of delivery drones hasn’t been off to an impressive flight, with Amazon Prime Air being present in only California and Texas, and having served fewer than 10 households, owing to a slow process with the FAA. 

Despite the challenges, the use of drones and drone-based services in retail and commercial spaces saw a boom. Drones started being explored extensively across an array of industries, including construction, e-commerce, agriculture, utilities and energy, financial services, media and entertainment, and more. 

Beyond the Sky in India

Compared to the US, India's drone industry is much smaller but growing rapidly.  The Indian UAV market has witnessed exhilarating growth on account of revving awareness, technological advancement, and growing businesses. In fact, between 1985 and 2014, India ranked first among drone-importing nations, with 22.5% of the world’s drone imports, followed by the United Kingdom and France.
The growth of the drone manufacturing sector will also reduce the current high dependency on military-grade UAV imports from other nations.

The eruption of COVID-19 further highlighted the significance of UAVs in Asian nations. According to estimates, the Indian drone market experienced a Compound Annual Growth Rate (CAGR) of almost 18% between 2016 and 2021. 

The ascent of the drone industry began with The Ministry of Civil Aviation, in August 2021, issuing liberalised Drone Rules, ushering India into “an era of supernormal growth.”

These regulations streamlined the bureaucratic process - reducing the number of forms and permissions from 25 to just 5, taking down types of fees from 72 to 4, labeling approximately 90% of airspace as Green Zone, abolishing several permissions, and much more.

 

Civil Aviation Minister, Jyotiraditya Scindia stated that the liberalised rules were meant to simplify the procedures and reduce the compliance burden for drone operation, to “trigger change ripples across sectors like agriculture, healthcare, mining, etc.”

The government of India saw the potential of the drone sector in India to significantly impact defence, surveillance, internal security, disaster management, agriculture, healthcare, geo-spatial mapping, mining, infrastructure, aerial photography, art, and many other areas. 

This combined effect of rising startups and government pushing the drone ecosystem ahead, the private equity investments in the drone sector also soared high.

In FY 2022 - 2023, drone start-ups attracted $49.7 million in investments across 20 rounds, compared to $25 million received in FY 2021 - 2022 across 23 rounds, and $11.2 million received in FY 2020 - 2021 across 20 rounds.

Between August 2021 and February 2022, India saw a 34.4% growth in the number of drone start-ups, bringing the total to 221.

In December 2022, the Pune-headquartered DroneAcharya became the first Indian drone player to go public. Following in its footsteps, in June 2023, ideaForge, the Qualcomm-backed drone start-up, became the first publicly listed drone company in India setting a milestone for the sector.

Government Levelling Up the Drone Sector in India 

To promote India’s emerging drone industry, the government introduced various policies and schemes, some of which are mentioned below:

Production Linked Incentive Scheme (PLI): Under the PLI scheme, the government of India provides a total incentive of US $162 million to drone manufacturers over three fiscal years. 

Drone Import Policy: In February 2022, the government restricted the import of foreign-made drones, while allowing the import of drone components, to further the government initiative of atma nirbharta or self-reliance.

Drone Shakti Program: The Drone Shakti scheme, announced as part of the Union Budget 2022 by our Honourable Finance & Corporate Affairs Smt. Minister Nirmala Sitharaman, seeks to unify the drone ecosystems by creating a structure that enables synergies among multiple stakeholders. 

Kisan Drone Scheme: Launched in February 2022 by the Union Agriculture Minister of India, Narendra Tomar, the Kisan Drone Scheme aims to provide 100 drones to Indian farmers. The primary goal of the scheme is to empower farmers by reducing labour and boosting incomes.

NAMO Drone Didi Scheme: Announced in December 2023, the NaMo Drone Didi Initiative aims to empower rural women by training them to become drone pilots for agricultural purposes. The initiative aims to equip 15,000 women-led Self-Help Groups (SHGs) with agricultural drones to assist in tasks such as crop monitoring, spraying fertilisers, sowing seeds, etc. Since the launch of the scheme, Garuda Aerospace has successfully trained over 185 rural women to be drone pilots.  

Bharat Drone Shakti 2023 Showcase: A first-of-its-kind drone exhibition cum display was inaugurated by Raksha Mantri Shri Rajnath Singh at Air Force Station, Hindan in Ghaziabad, Uttar Pradesh, on September 25, 2023. The two-day event, jointly organised by the Indian Air Force (IAF) and the Drone Federation of India (DFI), featured over 75 drone start-ups from across the country. 

Owing to our Prime Minister’s interventions and the proactive involvement of 12 central ministries in trying to boost demands for drone services, In 2023, India's commercial drone industry didn't just grow; it soared, nearly doubling its fleet with registrations rocketing from 4,972 to 9,842 on the DGCA's DigitalSky platform — an astonishing 98% increase.

To further promote drone operations in India, several government and private training institutions have also been set up. Indira Gandhi Rashtriya Uran Akademi, an autonomous body under the Ministry of Civil Aviation and one of the largest Flight Training Organisations in the country, has started DGCA-certified training at India’s first-ever Drone Flying Site in Gurugram.

Recently, Prime Minister Narendra Modi also launched an event called the “Drone Mahotsav” to promote the drone industry, highlighting its significance in various industries. 

The industry also saw a recent surge when the Finance Minister, Nirmala Sitharaman, while presenting the interim budget on February 1, 2024, raised the allocation for the PLI scheme for drone and drone components to Rs 57 crore for FY 2024 - 2025, up from Rs 33 crore in FY 2023 - 2024.

With the global drone market projected to reach $54 billion by 2025, India’s drone manufacturing potential stands to capture a substantial share, potentially reaching $4.2 billion and expanding to $23 billion by 2030

as per the EY-FICCI report “making India the drone hub of the world.”

Industries and Players in India

Agriculture remains one of the primary sectors driving drone adoption in India, with over 100 drone startups focusing on agri-tech solutions. UAVs are revolutionizing the sector by providing farmers with valuable data insights to optimize crop management practices. 

Companies like Skylark Drones and FlytBase offer drone solutions tailored for agricultural applications, empowering farmers to make informed decisions.

Safety and Surveillance across various sectors, including law enforcement, disaster management, and more also benefit from drone technology. 

Law enforcement agencies use drones for crowd monitoring, crime scene investigation, etc. In disaster management scenarios, drones are used for damage assessment, aerial reconnaissance, and delivering essential supplies to affected areas.

Companies like Quidich Innovation Labs and Asteria Aerospace provide customised drone solutions for safety and surveillance applications.

Infrastructure Inspection is another sector increasingly employing drones to offer cost-effective and efficient alternatives to traditional manual methods.

Utility companies use drones to inspect power lines, solar panels, and wind turbines, identifying defects or anomalies without the need for costly downtime or physical inspections.

Startups like ideaForge and Aarav Unmanned Systems specialise in providing drone solutions for infrastructure inspection.

Entertainment is yet another benefactor of drones with enthusiasts sharing breathtaking aerial footage, drone photography, and tutorials on drone flying and maintenance, on platforms like YouTube, X, and Instagram. 

The awe-inspiring drone show, with 5000 drones, dedicated to the pet project, Vantara, above Reliance Greens in Jamnagar during the pre-wedding celebrations of Anant Ambani and Radhika Merchant, including a tribute to Gauri, an elephant rescued by Nita Ambani, was yet another feat.

E-commerce platforms like Amazon, Zomato, Dunzo, and many more are already piloting drone delivery services in India, focusing on medical supplies, groceries, and essential commodities, with plans for scaling up operations in the future. 

Challenges with Hope

Though the current use cases of drones in India do not require very sophisticated technology, infrastructure, or workforce, as the industry expands more, these areas, along with a lack of proper testing facilities, and safety concerns might become potent challenges. Despite the challenges, corporations and government backing have led to a strong impetus for the drone industry in India, drawing a hopeful and successful picture.