Google's plan to establish drone manufacturing facility in India lifts domestic industry’s expectations

A meeting between officials of Google’s parent Alphabet and Tamil Nadu Chief Minister M.K. Stalin came as a shot in the arm for Indian drone manufacturers. Reports suggest that the tech giant is planning to set up a factory in the southern state to manufacture drones.

The Indian government’s efforts to give the industry a boost appear to be bearing fruit. In 2021, the government announced a subsidy of Rs 120 crore under the Production-Linked Incentive (PLI) scheme for the manufacturers of drones and their components. Then, in the Interim Budget 2024–25 presented earlier this year, Union Finance Minister Nirmala Sitharaman increased the outlay for the sector under the PLI scheme to Rs 57 crore from Rs 33 crore the previous year. 

In 2022, then Union Information and Broadcasting Minister Anurag Singh Thakur had said that India aims to become a global leader in drone manufacturing. Flagging off the Drone Yatra 2.0—an initiative to send drones to villages to apply pesticides to farms—he had said the country would require at least 100,000 drone pilots by 2023. Subsequently, the Directorate General of Civil Aviation (DGCA) recognised 63 remote pilot training organisations in 2023. 

But is the sector keeping pace with the government’s ambitions?

Data from research firm Tracxn shows there are 384 drone start-ups in India. The list includes ideaForge (India’s first listed drone manufacturer), Newspace Research and Technologies, Garuda Aerospace, Marut Drones, and General Aeronautics. A separate study by data platform Statista estimated that Indian drone companies would generate revenues of Rs 225 crore in 2024, against world leader China’s Rs 12,740 crore. 

Clearly, India is far behind in the drone manufacturing race and certainly far away from its goal to be among the world leaders. Can Google’s entry change this scenario?

“The entry of a tech giant is expected to liberalise the ecosystem as such companies accelerate partnerships. Also, it will generate new jobs such as testing pilots, engineers, etc.,” says Amandeep Panwar, Co-Founder and Director of agritech firm BharatRohan. But he adds that the Competition Commission of India and the government should not encourage a monopoly. 

Priyanka Agarwal Chopra, Managing Partner at start-up incubator IIMA Ventures, says Google’s entry could have a multiplier effect. “With the entry of a big company into the picture, newer technologies are expected to be introduced. Also, India will find a place on the global map of the drone industry, opening up new opportunities for existing start-ups,” she says. There are some who have expressed fears, considering Google’s conflict with some internet-based businesses over its billing policy. 

ideaForge’s CEO and Co-founder Ankit Mehta says that there’s no need for any organisation to feel threatened since it is a highly use-case specific technology. “As drones are used across agriculture, videography, defence, land mapping, etc., no one company can pose a threat to the entire ecosystem,” he says.

Further, Vikram Ramasubramanian, Partner at start-up investment platform Inflection Point Ventures, says there’s definitely room for more companies to enter. He says there are 30–40 drone companies that have approached his firm for funding. “Adoption will automatically get a boost if a tech giant ventures into the space because such a company will bring with it an entire ecosystem, from manufacturing technologies to global connections and projects,” Ramasubramanian adds. 

The sector can, perhaps, rightfully expect heightened interest now.  

@sudi_journolife