NAVIGATING THE SKIES: INDIA’S DRONE STARTUP LANDSCAPE

September 14, 2023

ABSTRACT

The drone industry has soared to new heights, transforming traditional paradigms across industries and unlocking unparalleled opportunities for innovation. As the world navigates the potential of these unmanned aerial marvels, India has emerged as a dynamic landscape where the convergence of technology, entrepreneurship, and regulatory frameworks has given birth to a vibrant ecosystem of drone startups.

This report sets its gaze on the dynamic interplay between technology, business, and regulations within this transformative space. By peering into the skies of innovation and entrepreneurship, this report aims to provide a comprehensive exploration of the drone industry’s ascent in India, spotlighting the pioneers who are redefining possibilities and charting a course toward a future where the sky is not the limit—it’s just the beginning.

HISTORY

The history of drones in India traces back to the early 1990s when the country first began experimenting with unmanned aerial vehicles (UAVs) for defense and reconnaissance purposes. The initial focus was on developing surveillance drones for military applications, including border monitoring and intelligence gathering.

Over the years, advancements in technology and the growing recognition of UAVs’ potential led to their adoption in various sectors beyond defense. The turn of the century witnessed the expansion of drone usage into fields such as agriculture, disaster management, environmental monitoring, and aerial photography.

MARKET SIZE & POTENTIAL

According to analysts, India can achieve INR 1.8 Lakh crore in domestic manufacturing potential through drone indigenization projects in defense, commercial, homeland security, and counter UAV sectors. They anticipate an 80% CAGR in 2020-25 and a 35% CAGR in 2025-30.

C-UAS: Counter UAS, HLS: Homeland Security | Chart not to scale. Source:( EY, FICCI )

KEY AREAS OF APPLICATION

AGRICULTURE

Precision Agriculture: Drones equipped with multispectral cameras capture images of farmlands, helping farmers identify crop health variations and optimize irrigation.
Crop Monitoring: Drones monitor large fields quickly, allowing farmers to assess crop growth, pest infestations, and nutrient deficiencies more efficiently.

INFRASTRUCTURE

Construction Site Monitoring: Drones survey construction sites regularly, tracking progress and identifying potential issues to enhance project management.

3D Mapping: Drones create detailed 3D models of landscapes and structures, aiding in urban planning and infrastructure development.

ENVIRONMENTAL

Pollution Monitoring: Drones equipped with air quality sensors measure pollution levels in real-time, enabling authorities to address environmental concerns.

Wildlife Conservation: Drones track wildlife populations, study migration patterns, and monitor protected areas to support conservation efforts.

DISASTER MANAGEMENT

Search and Rescue: Drones equipped with thermal cameras and GPS assist in locating missing individuals during disasters, speeding up rescue operations.
Damage Assessment: After disasters, drones capture high-resolution imagery, helping authorities assess infrastructure damage and plan recovery efforts.

HEALTHCARE

Medical Supply Delivery: Drones transport medical samples and supplies between hospitals and remote clinics, ensuring timely healthcare access.

Remote Diagnostics: Drones equipped with medical imaging technology enable remote doctors to diagnose and consult on medical conditions.

LOGISTICS

Last-Mile Delivery: Drones transport medical supplies, vaccines, and essential items to remote areas, overcoming transportation challenges.

Supply Chain Management: Drones monitor inventory levels, manage stockpiles, and streamline logistics operations, enhancing efficiency.

MEDIA & ENTERTAINMENT

Aerial Photography: Drones capture stunning aerial visuals for films, documentaries, and events, offering unique perspectives to audiences.

ENERGY

Wind Turbine Inspection: Drones inspect wind turbines for damage, helping maintain efficiency and prevent disruptions in renewable energy generation.
Power Line Monitoring: Drones assess power lines and transmission infrastructure, ensuring timely maintenance and minimizing outage risks.

REAL ESTATE

Property Evaluation: Drones capture aerial imagery of properties, aiding real estate professionals in showcasing listings and assessing potential properties.
Virtual Tours: Drones create immersive virtual tours of properties, allowing potential buyers to explore homes remotely and make informed decisions.

GOVERNMENT POLICIES TIMELINE

Onset of Drone Regulations (March 2014)

Drones were completely banned until 2014.
It was mandatory to take permission to operate drone for civil and commercial purposes
Permission had to be taken from AAI, Ministry of Defense, Ministry of Home Affairs and other relevant agencies

The Drone Policy 2018 (August 2018)

Flying drones or remotely piloted aircraft was legalized
Released categorization of drones based on size
Definition of green, yellow and red zones for drone flying
Formalization of Unique Identification Number & launch of Digital Sky platform

Unmanned Aircraft System rules (March 2021)

Use of drones for commercial & security purposes was encouraged
Prohibition of BVLOS (Beyond Visual Line of Sight) flying of drones
Micro & small UAS were not permitted from flying above 60m & 120m respectively

The Drone Rules (August 2021)

Regulation on import of drones by DGFT
No permissions required for flying in green zones
No restriction on foreign ownership or investment in Indian drone companies

The Drone Rules (August 2021)

Import of drones were banned except for R&D, defense & security purposes
Requirement of drone pilot license for operating drones scrapped
Remote pilot certificate issued by a DGCA approved school – sufficient to operate drone

GOVERNMENT INITIATIVES

With the aim of making India a global drone hub by 2030, a total of 12 central ministries are involved in trying to boost the indigenous demand for drone services. The central government has implemented the following reform initiatives to promote India’s emerging drone industry:

DRONE AIRSPACE MAP

In September 2021, the Indian Government opened 90 per cent of Indian airspace as a green zone for drones flying up to 400 feet.

DRONE IMPORT POLICY

The government announced in February 2022 that it had restricted the import of foreign drones while allowing the import of drone components.

PRODUCTION LINKED INCENTIVES

The government will provide a total incentive span over three fiscal years, of INR1.2 billion (USD162 million) to drone manufactures/industry.

DRONE (AMENDMENT) RULES

In February 2022, the Indian government abolished the requirement for a drone pilot’s license for flying certain types of drones and replaced them with more accessible certifications

DRONE SHAKTI

The union government announced the Drone Shakti scheme in its 2022 budget statement, with the goal of facilitating and promoting drones as a service through companies.

AGRICULTURAL DRONES MONETARY GRANT

To promote the use of kisan drones, the GOI is providing financial incentives. For instance, Farmers Producers Organisations can receive a up to 75 per cent subsidy of the cost of an agricultural drone.

DRONES AS A SERVICE (DaaS)

The emergence of drones-as-a-service is assisting businesses in managing costs. Businesses are choosing drones as a service because buying an enterprise-level drone can be very expensive.
The drone services market is segmented into three groups:

Drone platform services
Drone training and education services
Drone maintenance, repair, and overhaul (MRO).

The drone service market in India was estimated to be worth $130.4 million in 2020 and is anticipated to grow at a CAGR of 44.4% to reach $4,918.9 million by 2030.

DEFENSE APPLICATIONS

Longer flight times, improved range, quality cameras and intelligent systems as drone offerings are changing the landscape of warfare by providing better surveillance, reduced cost, reduced human capital loss, increased convenience / flexibility. Drones change the economics of warfare as drones which cost few tens of thousands of dollars are able to precisely attack and incapacitate heavy artillery worth millions of dollars.

Intelligence, Surveillance, Target Acquisition & Reconnaissance (ISTAR)

ISTAR drones use advanced technology for high-resolution surveillance.
They collect real-time data on enemy activities and terrain.
This data helps military leaders make informed decisions and execute precise operations.
ISTAR drones enhance situational awareness and mission planning while reducing risks to personnel.

Combat Operations

UCAVs revolutionize combat with remote engagement and precision strikes.
They use precision-guided munitions to engage high-value targets and support ground forces.
Combat drones increase operational effectiveness, reduce human risks, and minimize collateral damage.
They act as force multipliers, enhancing mission success and providing strategic advantages.

Logistical Support & Resupply

Drones revolutionize military logistics with agile resupply.
Cargo drones transport critical supplies to remote areas, reducing reliance on traditional routes.
They enhance operational continuity and responsiveness while minimizing human risk.

COUNTER DRONE SYSTEMS

Counter drone systems are vital technologies capable of detecting, identifying, tracking, and neutralizing UAVs or drones that threaten security, privacy, or airspace. The necessity for these systems arises from the widespread use of drones, both civilian and military, which offer benefits like improved communication, transportation, agriculture, entertainment, disaster management, and humanitarian aid. However, drones also bring challenges, including privacy violations, airspace disruptions, wildlife endangerment, infrastructure damage, and potential for malicious activities.
India faces an escalating challenge from hostile actors, such as Pakistan, China, and terrorist groups, using drones for reconnaissance, surveillance, intelligence gathering, smuggling, sabotage, or attacks. This intensifies the demand for counter drone systems in India.

Indian companies in the Counter UAV Space

Other Counter UAV companies

Australia

United Kingdom

KEY TECHNOLOGY TRENDS

AUTONOMOUS DRONES

Autonomous drones are a key technology trend in the drone industry that enable unmanned aerial vehicles (UAVs) to operate using artificial intelligence (AI)-powered navigation and operational software, and do not require a human pilot. Autonomous drones can perform tasks and make decisions on their own, such as taking off and landing, carrying out aerial site inspections and surveying, and executing stunts

SWARM DRONES

Swarm drones are a key technology trend in the drone industry that involves the use of multiple drones that coordinate and cooperate with each other to achieve various missions. Swarm drones can be used for surveillance, attack, electronic warfare, and other applications in contested or hostile environments. Swarm drones can confuse the enemy radar, overwhelm the defenses, and deliver precise strikes with minimal human intervention.

ACCELARATED 3D MAPPING

Accelerated 3D mapping is a key technology in the drone industry that enables fast and accurate generation of 3D models of the environment using drone imagery. It can be used for various applications such as surveying, inspection, construction, agriculture, mining, and disaster management. It can reduce the time and cost of data acquisition and processing, improve the quality and resolution of the 3D models, and enhance the decision-making and planning capabilities of the users.

ECONOMIC BENEFITS OF DRONES

Drones have the potential to reduce costs and increase the value of information obtained through these systems. This has been a key factor in encouraging drone adoption. Drones can replace traditional methods that relied on occasional and unreliable data collection with low-cost and high-quality data. Drones can also drive significant cost efficiencies, especially in the agriculture and infrastructure sectors, where they can enable mass adoption. The table below shows some of the application areas and the cost savings achieved by using drones.

AREAS	EXISTING PROCESS	POTENTIAL BENEFITS	SAVING DETAILS (APPROX.)
Planning surveys and mapping	• Ground-based manual data collection • Manual analysis and single-point decision-making	• Automated analysis and collaborative decision-making • 10x faster and 10000x more data points on a digitized base for better plans.	• Existing cost: INR10-12 thousand per sq. km • Potential cost: INR6 thousand per sq. km • Cost Savings: 45%
Construction monitoring	• Excel-based progress tracking without visual verification.	• Automated object recognition, counting and progress tracking on drone maps • 80% faster and improved transparency and on-site governance	• Existing cost: INR2.5 thousand per km for road construction survey • Potential cost: INR1.5 thousand per km • Cost Savings: 40%
Earthworks management	• Manual data collection and reporting • Paper-based volumetric tracking without visual verification.	• 30x faster data collection and 350x more data points than with traditional (Global navigation satellite system) GNSS survey • 4x faster turnaround and end to end tracking.	• Time consumption: 15-30 days for surveying 100-acre job site • Time Benefits: 20 mins to survey 100- acre job site • Cost Savings: 90%
Agriculture crop monitoring and spraying	• Manual applications – unsafe, in-efficient and limited access to skilled labor • Erroneous, single point-decision making.	• 10x faster turnaround, efficient and cost saving • Automated analysis and collaborative decision making.	• Existing cost: INR1500-1800 per acre for spraying • Potential cost: INR300-400 per acre • Cost Savings: 80%.
Industrial asset maintenance and sustainability	• Erroneous, unsafe, and infrequent manual inspections • Ad-hoc manual patrolling with no visual evidence.	• Automated diagnostics from safe and frequent aerial inspections • Real-time, centralized view of inaccessible and remote assets.	• Existing cost: INR90- 100 thousand per chimney inspection using crane • Potential cost: INR50 thousand • Cost Savings: 50%

AREAS

EXISTING PROCESS

POTENTIAL BENEFITS

SAVING DETAILS (APPROX.)

Planning surveys and mapping

• Ground-based manual data collection

• Manual analysis and single-point decision-making

• Automated analysis and collaborative decision-making

• 10x faster and 10000x more data points on a digitized base for better plans.

• Existing cost: INR10-12 thousand per sq. km

• Potential cost: INR6 thousand per sq. km

• Cost Savings: 45%

Construction monitoring

• Excel-based progress tracking without visual verification.

• Automated object recognition, counting and progress tracking on drone maps

• 80% faster and improved transparency and on-site governance

• Existing cost: INR2.5 thousand per km for road construction survey

• Potential cost: INR1.5 thousand per km

• Cost Savings: 40%

Earthworks management

• Manual data collection and reporting

• Paper-based volumetric tracking without visual verification.

• 30x faster data collection and 350x more data points than with traditional (Global navigation satellite system) GNSS survey

• 4x faster turnaround and end to end tracking.

• Time consumption: 15-30 days for surveying 100-acre job site

• Time Benefits: 20 mins to survey 100- acre job site

• Cost Savings: 90%

Agriculture crop monitoring and spraying

• Manual applications – unsafe, in-efficient and limited access to skilled labor

• Erroneous, single point-decision making.

• 10x faster turnaround, efficient and cost saving

• Automated analysis and collaborative decision making.

• Existing cost: INR1500-1800 per acre for spraying

• Potential cost: INR300-400 per acre • Cost Savings: 80%.

Industrial asset maintenance and sustainability

• Erroneous, unsafe, and infrequent manual inspections

• Ad-hoc manual patrolling with no visual evidence.

• Automated diagnostics from safe and frequent aerial inspections

• Real-time, centralized view of inaccessible and remote assets.

• Existing cost: INR90- 100 thousand per chimney inspection using crane

• Potential cost: INR50 thousand

• Cost Savings: 50%

FUNDING OVERVIEW

Year-on-year, funding inflows have witnessed remarkable growth, a testament to the sector’s potential and growing investor confidence.

However, it is imperative to recognize that India currently occupies a lower rung in the global funding ranking for drone startups. This underscores the urgent need for substantial investments to propel our drone ecosystem forward.

COMPANY HIGHLIGHTS

IdeaForge Technology Ltd. is the pioneer and the pre-eminent market leader in the Indian Unmanned Aircraft Systems (UAS) market. The company is exclusively engaged in the business of manufacturing and marketing UAV systems which are used for security and surveillance. The ancillary business of providing training and maintenance services evolve around the main business of manufacture and marketing of UAV systems.

Developer of drone-based delivery technology intended to deliver goods to any location. The company’s technology lets hassle-free deliveries in remote locations with a wide web network of drones, enabling businesses to enhance the capability to fulfil first-to-last-mile with fast, efficient and contact-free deliveries.

Developer of an unmanned aerial system designed to provide high-value engineering services to enterprises across GIS surveying and precision agriculture. The company’s systems and drones offer rich data and help to create insightful analytics, enabling clients to make well informed decisions in mining, urban planning, infrastructure, and agriculture.

Developer of cloud-based multi-utility drones for industrial applications. It offers solutions for photography, agricultural surveys, surveillance, and more. It also offers services in the areas of agriculture, crowd monitoring, defence, mapping, and wildlife monitoring

DroneAcharya provides high-end ecosystem of Drone solutions for multi-sensor drone surveys, data processing of drone data using robust high configuration workstations, the main operations of the company are imparting. The drone operation training, drone supply and maintenance services, drone pilot training & specialized GIS training. The company’s offering can be classified into four broad categories namely, Training, Services, Surveillance and Others.

Developer of enterprise drones designed to provide location mapping services. The company’s drones offer services like mining inspections, aerial land surveying, and even advertising using drones, enabling clients to access and understand drone data anywhere and at any time.

Manufacturer of industrial drones intended to provide end-to-end solutions. The company’s products include hepicopter, seedcopter, and Marut zap, its technology uses data analytics and machine learning, enabling businesses to build a sustainable ecosystem and reduce labor toil and hazardous chemicals.

Provider of unmanned and unmanned aircraft, design, testing, and development services. Its fixed wing unmanned UAV called GA-1 is capable of carrying multiple types of payloads for various surveillance purposes and deliveries and can perform vertical take-off and landing (VTOL). It’s manned aircraft design services include design and testing for drag reduction, and supersonic flight systems.

COMPANY HIGHLIGHTS

FUTURE OUTLOOK

India’s drone startup scene is on the brink of significant growth and transformation, fueled by factors aligning with the nation’s self-reliance and tech advancement goals. The government’s Aatmanirbhar Bharat initiative, including waivers for pilot permits, streamlined regulations, dedicated drone corridors, manufacturing incentives, and corporate partnerships, is driving this change.

These initiatives reflect the government’s commitment to boost both drone manufacturing and services. This synergy opens doors for startups in sectors like agriculture, healthcare, and infrastructure, as regulatory hurdles ease, promoting innovation and scalability.

This shift envisions drone startups reshaping industries, from precision agriculture to healthcare, enhancing efficiency and data-driven insights. As India progresses technologically and self-sufficiently, the drone startup ecosystem becomes a beacon of innovation, fueling progress on regional and global stages. The future holds unparalleled growth and impact as India’s drone startups redefine possibilities.

REFERENCES

India’s Emerging Drone Industry: A Point of View, KPMG, June 2022
Drone Industry Report, 1Lattice | ideaForge, June 2023
Making India the Drone Hub of the World, EY | FICCI, August 2022
Budget 2022: Drone Shakti, Invest India, February 2022
The Coming of Age of the Indian Drone Industry, Invest India, February 2022
Everything you need to know about the drone-as-a-service model, Business Standard, March 2022
Make in India for Unmanned Aircraft Systems, FICCI, August 2019
Will India lead the drone delivery industry in the world?, Times of India, May 2022
Tracxn Reports, tracxn.com