According to Jyotiraditya Scindia, the drone manufacturing industry is expected to generate more than 10,000 direct jobs, probably an industry of Rs 900 Cr by fiscal year 2023-24
New Delhi, September 16: Take a further step towards realizing our collective vision of a Aatmanirbhar Bharat, the central government under the leadership of Prime Minister Shri Narendra Modi approved the Production Linked Incentive Program (PLI) for drones and drone components on September 15, 2021. Jyotiraditya Scindia, Minister of Civil Aviation of Union, briefed the media on the important features of the PLI regime at a press conference today.
Read also | PLI program for automotive and drone industries: PM Narendra Modi Govt approves Rs 26,000 Crore to increase production
Scindia said that under the PLI program, incentives of Rs. 120 crore will be given in the next 3 years. This amount is 1.5 times the combined size of the drone manufacturing industry. Over a three-year period, an estimated investment worth Rs 5,000 crore for drones in the manufacturing sector will be made, resulting in a turnover of Rs 900 crore and 10,000 job opportunities will be made. created. Draft 2021 drone rules released by the Ministry of Civil Aviation, inviting public comment until August 5.
Scindia added that our goal is to make India a global drone hub by 2030 and the Ministry of Civil Aviation is committed to facilitating industry, service delivery and consumers in the achievement of the aforementioned objective.
Read also | IndiGo flights on the Jabalpur-Delhi route inaugurated by Jyotiraditya Scindia; Check the full flight schedule and schedule here
Top 15 PLI program features for drones, 2021
The total amount allocated to the PLI program for drones and drone components is INR 120 crore spread over three fiscal years. This amount is almost double the combined revenue of all domestic drone manufacturers in fiscal year 2020-21.
The incentive for a manufacturer of drones and drone components must reach 20% of the added value that it brings.
The value added should be calculated as the annual revenue of drones and drone components (net of TPS) less the purchase cost (net of TPS) of drones and drone components.
The government agreed to keep the PLI rate constant at 20% for the three years, exceptional treatment given only to the drone industry. In PLI schemes for other sectors, the PLI rate decreases each year.
The proposed duration of the PLI plan is three years from the 2021-22 fiscal year. The PLI regime will be extended or revamped after considering its impact in consultation with industry.
The government has agreed to set the minimum value-added standard at 40% of net sales of drones and drone components instead of 50%, another exceptional treatment accorded to the drone industry. This will make it possible to expand the number of beneficiaries.
The PLI diagram covers a wide variety of drone components:
Airframe, propulsion systems (motors and electrics), power systems, batteries and associated components, launch and recovery systems;
Inertial measurement unit, inertial navigation system, flight control module, ground control station and associated components;
Communication systems (radio frequency, transponders, satellite, etc.)
Cameras, sensors, spray systems and associated payload, etc. ;
“Detect and avoid” system, disaster recovery system, trackers, etc. and other components essential to safety and security.
The list of eligible components may be expanded by the government from time to time, as drone technology evolves.
The government has agreed to expand the coverage of the incentive program to also include developers of drone-related IT products.
The government has maintained the eligibility standard for MSMEs and startups in terms of annual turnover at a nominal level – INR 2cr (for drones) and INR 50 lakhs (for drone components). This will make it possible to expand the number of beneficiaries.
The eligibility standard for non-MSME companies in terms of annual turnover has been maintained at INR 4 crore (for drones) and INR 1 crore (for drone components).
The incentive payable to a manufacturer of drones and drone components will simply be one-fifth of its added value.
A manufacturer’s PLI must be capped at 25% of the total annual expenditure. This will make it possible to expand the number of beneficiaries.
If a manufacturer does not meet the threshold of eligible added value for a particular fiscal year, they will be allowed to claim the lost incentive the following year if they make up the shortfall in the following year.
The estimated payment schedule is shown below:
Drones provide tremendous benefits to almost all sectors of the economy. These include agriculture, mining, infrastructure, surveillance, emergency response, transportation, geospatial mapping, defense and law enforcement, for to name a few. Drones can be important creators of jobs and economic growth due to their reach, versatility and ease of use, especially in remote and inaccessible areas of India. PLI program for automotive and drone industries: PM Narendra Modi Govt approves Rs 26,000 Crore to increase production.
Given its traditional strengths in innovation, information technology, frugal engineering, and huge domestic demand, India has the potential to become a global drone hub by 2030. The PLI program follows liberalized drone rules 2021 released by the Central Government on August 25, 2021. The PLI program and new drone rules are intended to catalyze supernormal growth in the future drone industry.
Likely impact of recent drone initiatives
Thanks to the new rules and the incentive program, the drone and drone component manufacturing industry could see an investment of over INR 5,000 crore over the next three years. The annual turnover of the drone manufacturing industry could increase from INR 60 crore in 2020-2021 to over INR 900 crore in 2023-24. The drone manufacturing industry is expected to generate more than 10,000 direct jobs over the next three years.
The drone services industry (operations, logistics, data processing, traffic management, etc.) is much larger. It is expected to reach over INR 30,000 crore over the next three years. The drone service industry is expected to generate more than five lakhs of jobs in three years.