Today, India is passing through a strategic journey of adopting new technologies, and maybe the most active of these changes is in the field of aerospace and drones. Following the introduction of India's Drone PLI Scheme, the government has expressed a strong commitment to creating an economically viable ecosystem for drone manufacturing, innovation, and exports. This move is not just aimed at creating India's indigenous drone business but also towards becoming a part of creating a healthy aerospace manufacturing business in India.
With the growing demand for unmanned floating systems all over the world in sectors like agriculture, logistics, defense, and surveillance, India is also becoming a center of innovation as well as production. Let us find out how the Drone PLI Scheme is promoting aerospace production in India, its influence on startups and players, and how it is linked to bigger industrial policy initiatives like Make in India and Aatmanirbhar Bharat.
The Production-Linked Incentive (PLI) Scheme for drone and drone component manufacturing, launched in 2021, was a strategic policy decision with the aim of enhancing the growth of India's aerospace sector. The scheme grants financial incentives of up to ₹120 crore spread over three years to the selected drone manufacturers as an activity of higher value.
The PLI scheme for the aero sector is to reduce reliance on imports, encourage local production of parts, and create an integrated value chain in India. Incentives are given to incumbent players as well as Indian drone startups, which is critical in dynamic innovation as well as enabling MSMEs to enter the frontier space. Through value addition and modern production, the Drone PLI Scheme is aligning with the country's overall vision to be among the world leaders in aircraft manufacturing.
“The Drone PLI Scheme is not just about incentivizing manufacturing — it’s about reshaping India’s aerospace narrative. For the first time, we’re looking at a deeply integrated, innovation-led supply chain that can compete globally.” - Dr. Rajiv Mathur, Former Director, DRDO & Aerospace Policy Advisor
Also Read: Engineering the Future: AI and Mobility Platforms in Smart Electronics
The Indian drone market experienced its ascendancy successfully in the recent past. According to industry estimates, the Indian drone market is going to grow at a CAGR of over 20% and reach $1.5–2 billion by 2026.
The Drone PLI Scheme has been the biggest individual policy catalyst of such growth. Previously, India had been net importing drone components, but there have been announcements from dozens of firms of expansion, joint ventures, and R&D proposals to develop indigenous capabilities from the post-schemes.
Indian expansion of the drone industry is also being spearheaded by expanding needs in agriculture (crop surveillance and pesticide application), infrastructure (construction monitoring and surveying), and public security (law enforcement and emergency services). The addition of drones into Indian defense has also disclosed enormous prospects for private sector participation on a massive scale.
Also Read: How India's drone industry is benefiting from the PLI scheme
“Perhaps the most encouraging part of the Drone PLI Scheme is that it provides a direct benefit to Indian drone startups.” With nominally low barriers to entry, the scheme is friendly to startups and incentivizes bottom-line innovation.
Over 300 drone startups have emerged in India over the recent past. They are mainly employing AI, machine learning, and computer vision to create high-tech autonomous drones. The PLI scheme gives them confidence and capital to expand and take on international brands.
The ecosystem of entrepreneurship is being facilitated by incubators, research and development centers within universities, and venture capital, making the ground fertile to upset innovation.
“India is well on its way to becoming not just a drone user, but a global drone exporter. With strong design capabilities and policy support, the country is fast emerging as the next big aerospace hub.” - Saurabh Mishra, Former VP, Bharat Electronics Limited (BEL)
Aerospace Manufacturing Ecosystem IndiaThe Indian manufacturing ecosystem can develop a full value chain for aerospace manufacturing of drones. In contrast to the previous efforts based on end assembly, the Drone PLI Scheme promotes the manufacturing of components, sensors, propulsion systems, batteries, and control systems.
This vertical integration will be the cornerstone of India's long-term competitiveness. Businesses are presently investing in domestic design and testing facilities, certification levels, and university collaborations to make India a world supplier, rather than a consumer, of aerospace-grade drone technology. Apart from this, this shift is creating high-skill jobs in electronics, mechanical design, software programming, and AI integration. A robust ecosystem also enables India to drive export-led development, creating productive foreign exchange as well as technological capital.
The Make in India drones program is being promoted by the PLI scheme. Due to the incentive given to local manufacturing instead of imports, the government has made it clear for drone independence. Therefore, the local Indian companies now produce drones locally for local uses, i.e., spray drones for agriculture, power line inspection drones, or environment survey drones, once again proving the country's unusual manufacturing capability. Companies like IdeaForge, Garuda Aerospace, and Aarav Unmanned Systems are examples of how the Make in India drone policy is producing local heroes who even sell their products outside India these days.
Also Read: RRP Defence Partners with CYGR for New Drone Plant in India
Drones have become a large component of Indian defense production, primarily following the 2020 indigenization push across the defense sector. All three wings of the Indian Armed Forces, the Navy, Army, and Air Force, have issued tenders for various types of UAVs, ranging from micro drones to long-endurance surveillance UAVs.
The Defence Ministry has already placed drones on the Positive Indigenization List, limiting their import and indicating harsh indigenous procurement proposals. The PLI scheme is following suit by promoting Indian companies that are technologically and financially sufficient to undertake this requirement. India is also ramping up joint ventures with foreign companies with defense tie-ups, enhancing technology transfers and capability builds for defense-grade drone manufacturing.
“The government needs to show the intent to support drone start‑ups towards R&D; that will not only help them from the government’s side, but also attract domestic and global VCs, as they'll see that this field has the desired support from the government.” - Ashish Kumar, Co‑founder & General Partner, Fundamentum
India Drone Manufacturing PolicyIndia's drone manufacturing policy is an overarching policy consisting of the PLI scheme, rule relaxation, import ban, and research and development encouragement.
A combination of these policy initiatives indicates that India is seriously accepting the challenge of becoming a superpower in drones.
The launch of the Drone PLI Scheme is not only increasing India's aerospace manufacturing through incentives, but it is also accelerating an underlying structural change in the nation. The Indian scheme is also attracting the attention of the foreign OEMs, private equity players, and defense contractors.
India is potentially poised to assume the role of strategic position in international channels of drone distribution in 5-10 years, not only providing a positioned drone but also a high-margin component, software, and integration offerings. Drone would be the best combination of innovation, production, and strategic autonomy for a nation that has economic growth and technological edge interest in it.
The Drone PLI Scheme India has put the wheels in place for the final imagination of India in the aerospace industry. With their plans to create a world-leading aerospace manufacturing ecosystem in the country, supporting drone startups, promoting Make in India drones, and aligning the entire India drone manufacturing policy, India is not only keeping pace with the rest of the world, but they are going to take the lead.
Under assistive policies, increasing interest of the private sector, and the growing stock of high-quality talent, the Indian drone industry is on a path to not only cater to the domestic population but also set the future of the global aerospace industry's manufacturing.
The Drone Production-Linked Incentive (PLI) Scheme is an initiative by the government launched in 2021 for encouraging domestic production of drones. It grants monetary incentives amounting to a maximum of ₹120 crore over a three-year tenure to such manufacturers of drones and drone parts that are otherwise eligible.
The program has a subsidy of funds and policy impetus to indigenous production, prohibits the import of whole drones, and encourages the localization of innovation, propelling the Make in India program.
The Indian drone market is anticipated to expand at more than 20% CAGR to $1.5–2 billion by 2026, from expanding applications in agriculture, logistics, monitoring, and defense.
.jpg "Lifting India's Industrial Future with Innovation, Strength, & Precision")
.jpg "ATMA Autotech Engineers: Innovative Engineering Solution Provider & Manufacturer of Automation Oriented Machines")
We use cookies to ensure you get the best experience on our website. Read more...
