Policy Update
Aryan Bordoloi
Background
In just one budget cycle India’s drone industry went from the fringes of civil aviation policy to an official driver of Aatmanirbhar Bharat. The turning point was the new liberalised Unmanned Aircraft System (UAS) Rules, 2021, by the Ministry of Civil Aviation notifying on 25 August 2021 which replaced the compliance-heavy Civil Aviation Requirements of 2018 with a lighter framework, where security clearance was not required, type certificates were not required, import clearances were not required, and several other approvals were eliminated, and where close to 90 per cent of Indian airspace was declared as ‘green zones’’ where drone flights up to 400 feet will be allowed without case-by-case permission.
Five months later, in the Union Budget, 2022-23, Finance Minister Nirmala Sitharaman announced the scheme Drone Shakti in which startups will drive the promotion of ‘Drone-as-a-Service’ (DrAAS). Drone Shakti is not an independent scheme with its own budget line, but rather a push initiative that will be undertaken through various channels, including the liberalisation of the drone regulations, the Production-Linked Incentive (PLI) Scheme for drones and drone components (announced on 30 September 2021 for an outlay of ₹120 crore over three years), the ban on import of foreign drones announced in February 2022 and skilling the sector through Industrial Training Institutes (ITIs). In the past five years, from the 2021 rules to the Namo Drone Didi scheme for women’s SHGs in 2024, and the Draft Civil Drone Bill in 2025, the ecosystem on Drone Shakti has evolved.
Functioning
The regulatory foundation
The Drone Rules, 2021 has established the Digital Sky Platform, a one-stop solution for drone registration, permissions and certification, which is based on a “No Permission, No Takeoff” (NPNT) protocol, meaning that a drone not granted electronic clearance via the app will not arm its motors. The Airspace was divided into three colour zones: green, yellow and red with permission required in the yellow zone, which was shrunk to a radius of 12 kilometres around airports. The Drone (Amendment) Rules, 2022 have introduced a Remote Pilot Certificate (RPC) issued by DGCA-approved Remote Pilot Training Organisations (RPTOs) for a period of ten years, to replace the old DGCA-issued Remote Pilot Licence, with a conscious effort to do this to facilitate entry for rural and semi-urban operators. This amendment was followed by an extension of accepted documentation for registration to include voter ID, ration card and driving licence in the Drone (Amendment) Rules 2023.
Although the import ban remains in effect, manufacturing incentives are provided.
Under the PLI Scheme for drones, the incentive of 20 per cent of “value addition” in India (annual sale revenue after deducting GST and cost of inputs bought from others) will be given on 40 per cent of the value addition to manufacturers for three financial years starting 2021-22. The eligibility criterion for smaller players, particularly MSMEs and startups, was calibrated with lower sales figures: drone manufacturers will be offered the incentive for annual sales of as low as ₹2 crore while the component manufacturers will get it at ₹50 lakh per annum, and the maximum incentive to one beneficiary has been capped at 25 per cent of the total outlay to spread the benefit over more firms. This was reiterated in February 2022, when the Directorate General of Foreign Trade decided to stop the import of fully-built, semi-knocked down and completely-knocked down foreign drones, except for research, defence and security applications, for which import permits would be issued on a case-by-case basis. Import of individual drone parts, on the other hand, was not barred, thereby ensuring the ability to assemble and integrate locally while still providing access to parts from around the world.
Sector-specific delivery vehicles
Since then, the DrAAS model has been implemented in a piecemeal manner—under sector-specific programmes and schemes, not a single comprehensive fund. SVAMITVA (2020, scaled up to 2021-26): Mapping of rural inhabited land using drones and issuing of property cards has been completed in approximately 3.1-3.28 crore property cards in over 3 lakh villages by the start of 2026. The Agriculture Ministry has prepared standard operating procedures (SOP) for pesticide spraying using drones in ten crops and given up to 50–100 per cent subsidy to individual farmers, Farmer Producer Organisations and Custom Hiring Centres for purchasing drones. Namo Drone Didi (approved November 2024, outlay of ₹1,261 crore for 2023-24 to 2025-26) provides 14,500–15,000 women’s SHGs with drones for rent and their financial assistance comes at 80 per cent as central funds (capping at ₹8 lakh) and 3 per cent as interest subvention on the balance amount. Annual industry showcases, Bharat Drone Mahotsav / Bharat Drone Shakti, used to certify pilots, launch products, and showcase use-cases to the state governments and the armed forces and were held at Hindon airbase in October 2022 and at New Delhi in October 2023 along with the Indian Air Force and Drone Federation of India.
Performance
If growth is measured by ecosystem regulatory and manufacturing metrics, then its progress has been quick since 2021 but still very low. DGCA data indicate that the number of registered drones increased from approximately 13,000 at the end of 2023 to more than 38,500 by the end of February 2026; the number of certified remote pilots grew by more than four times, from about 8,000 to nearly 40,000; and the number of approved RPTOs increased by more than 3.4 times, from 70 to around 240.
Figure 1: Registered drones, certified pilots and approved training organisations, 2023 vs. 2026. Source: DGCA data as reported in industry and news coverage, compiled by IMPRI.
On the manufacturing side, the Civil Aviation Ministry’s own benchmark at the time of the PLI notification was for domestic manufacturer turnover to grow from about ₹80 crore in FY 2020-21 to ₹900 crore within three years. Independent market estimates since suggest the wider drone market — combining manufacturing and services — was valued at roughly ₹5,700 crore (about USD 0.7 billion) in 2024, with projections of ₹12,300 crore (about USD 1.4 billion) by 2029-30, implying the number of drones in operation could rise from about 10,800 to over 61,000 units in the same window. These are not the same metric and should not be read as a single continuous trend line, but together they indicate an industry that has moved from a few dozen manufacturers to more than 200 drone startups that have collectively raised over ₹1,200 crore since 2014, with over 350 receiving DPIIT startup recognition and more than 60 venture-funded.
Figure 2: India’s drone sector value, from manufacturer turnover baseline to projected market size. Source: PIB, industry market reports (indicative; figures vary by methodology).
The employment numbers reported in recent coverage are estimates of the industry’s employment, both in manufacturing and in piloting, training and support services, as of 2024, and forecast to go up to 1,20,000 manufacturing jobs and 6,00,000 service-sector jobs as the deployment expands — but are not yet audited, so care should be taken in interpreting the numbers as provided by industry sources and as employment multipliers.
Impact
Agriculture and rural livelihoods
The best ground impact to date is in agriculture. Kisan drones are said to spray at a rate of about one acre in 7–8 minutes compared to several hours needed for manual spraying, thereby reducing the exposure of farm workers to direct contact with pesticides and minimising pesticide runoff. The scheme’s design aims to add an estimated ₹1 lakh to the income of the rural women participating in each SHG every year, and the first 500 distributed drones showed flight times ranging from five to twenty minutes per battery (depending on the drone manufacturer). Namo Drone Didi is an early economics and viability study of the first 500 of the distributed drones, and the results were a viable increase of at least ₹1 lakh in additional income per participating SHG per year—an increase that is worth noting, especially by comparison with the rare example of a technology-diffusion program specifically designed around women as service providers, not just beneficiaries.
Land governance
The institutional impact of the use of drone based mapping by SVAMITVA has been most measurable with the transformation of undocumented rural land holdings to property records that can be used for the purpose of lending and as a means to eliminate a key source of land conflicts in the community. At more than 3 crore, it is perhaps the biggest civilian drone deployment in the world, and a blueprint followed by other programmes run by the Ministry of Panchayati Raj.
Strategic autonomy & manufacturing
The import ban, together with PLI incentives has been visibly encouraging the shift in investment towards domestic assembly and to a growing extent in component manufacturing as well – battery and subsystem plants have been established in Chennai and elsewhere and at least one manufacturer based in India has obtained an export licence from the DGCA for the US, Australian and Middle Eastern markets. This is in sync with the parallel initiative also being pushed by the defence ministry for indigenous unmanned systems, where the drones have gone from being used just as a surveillance resource to becoming a more regular feature in the LOC monitoring and loitering-munition programme — an aspect of the defence dimension that IMPRI has documented separately.
Emerging Issues
Enforcement gap: Despite the import ban in 2022, consumer drone manufacturing in India continues to be overwhelmingly dominated by Chinese manufacturers, which are unregistered and not part of the National Policy of Nanotechnology (NPNT); enforcement is intermittent at the customs and local levels.
Metric mismatch: Government turnover targets, industry market-value estimates and employment projections are all based on different sets of data (manufacturer turnover vs. total market value vs. projected jobs), so it is hard to independently assess whether Drone Shakti’s own projected growth targets for 2022 have been achieved in like-for-like terms.
Beyond Visual Line of Sight (BVLOS) and Unmanned Traffic Management (UTM): The framework for BVLOS and UTM are still in its infancy and the DGCA has identified them as a framework that will continue to evolve until 2026.
The unavailability of consistent service delivery under schemes such as Namo Drone Didi, such as the lack of proper certified repair engineers and 4G/5G connectivity in rural areas, and the battery life is still a major challenge.
The swift civilian expansion is also accompanied by noted dual-use concerns, such as the use of small drones in attempted attacks on defence installations, and privacy and security concerns, as the Digital Personal Data Protection Act, 2023 (DPDPA) does not apply in full with reference to data from aerial surveillance, which the Draft Civil Drone Bill, 2025 (released for public comment in September 2025) seeks to address.
Regional concentration: Although the Northeast and other peripheral areas are important for border security, disaster response and land mapping, there is little apparent investment at this point in the region, and start-up funding and RPTOs are still concentrated in a few states and metros.
Way Forward
There will be a single and periodically updated dashboard ideally on Digital Sky that correlates the number of drones registered, disbursement of PLI, DrAAS revenue and employment under the scheme to allow the outcomes of Drone Shakti to be measured on a consistent basis, as opposed to through isolated industry estimates.
Finish the Civil Drone Bill: Final approval of the 2025 draft bill, which includes adequate data protection, liability and BVLOS provisions, will provide commercial operators, especially in logistics and infrastructure inspection, with the regulatory security needed for them to move beyond pilot projects.
Enhance last-mile connectivity and maintenance facilities: Last-mile service infrastructure needs to be scaled up in Tier-3 towns and border districts, to address rural connectivity and maintenance problems that are currently hampering schemes like Namo Drone Didi and Kisan Drones.
Extend Drone Shakti to the Northeast and border regions: The region’s terrain-specific logistics costs coupled with the relevance of such land mapping programs for disaster response and border-area surveillance, a dedicated regional push to extend Drone Shakti’s employment and governance benefits could benefit areas it has so far under-served.
To ensure that import ban is enforced in a proper manner, it is necessary to have a coordinated effort between DGFT, Customs and DGCA rather than periodic seizures as there is a gap between the ban and the presence of unregistered foreign consumer drones.
References
About the Contributor
Ayan Bordoloi is an intern with IMPRI, currently pursuing his master’s in political science at the University of Delhi. His research interests lie in federalism, tribal governance, and Northeast India’s political landscape.
Acknowledgements
The author extends sincere gratitude to the IMPRI team for their guidance and support, along with the reviewers Khushi and Anamika P K for their valuable feedback and insights.
Disclaimer: All views expressed in the article belong solely to the author and not necessarily to the organization
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