India’s New Drones PLI Policy to Attract ₹5,000 Cr Investments

    India’ s ambitious new Drones PLI Scheme will bring fresh investments of over₹5,000 crore in three years and incremental production of over ₹ 1,500 crore.

    Additional a new PLI Scheme for automotive sector along for Advanced Chemistry Cell (₹18,100 crore) and Faster Adaption of Manufacturing of Electric Vehicles (FAME) Scheme (₹10,000 crore) will give a big boost to manufacture of Electric Vehicles

    Furthermore the new scheme will enable India to leapfrog to environmentally cleaner, Electric Vehicles and Hydrogen Fuel Cell Vehicles

    The Indian government on Wednesday also approved to allocate Rs 120 crore spread over the next three financial years towards production linked incentives (PLI Scheme ) for manufacturing drones and its components in the country.

    Drones PLI Scheme 2021: Government has approved Production Linked Incentive (PLI) Scheme for Auto Industry and Drone Industry to enhance India’s manufacturing capabilities

    Industry experts say the move could be a major shot in the arm for the local drone industry especially when seen in tandem with the highly liberal new drone rules. It could be a key driver for the Indian market where domestic drone companies have so far largely depended on importing a number of components from China to build their drones.

    The incentive for a manufacturer of drones and drone components shall be as high as 20% of the value addition made by them. The value addition shall be calculated as the annual sales revenue from drones and drone components (net of GST) minus the purchase cost (net of GST) of drone and drone components.

    The government has kept the PLI rate constant at 20% for all three years, which is unique to the drone industry. In PLI schemes for other sectors, the rate reduces every year.

    Incentives worth ₹ 26,058 crore will be provided to industry over five years

    The proposed tenure of the PLI scheme is three years starting in FY 2021-22 and will be extended or redrafted after studying its impact in consultation with the industry.

    “The scheme will bring huge economic multipliers for India,where drones & drone components manufacturing sector is likely to see an investment of over INR 5000 cr and generate 10000 direct jobs over 3 years,” Civil Aviation Minister Jyotiraditya Scindia said in a statement.

    “The annual sales turnover of the drone manufacturing industry may grow from Rs 60 crore in 2020-21 fold to over Rs 900 crore in FY 2023-24,” the Civil Aviation Ministry said in a statement.


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