Business Standard

A FLYING START FOR DRONES

India's new regulation forthe use of Unmanned Aerial Vehicles that opens the door for foreign players could be a boon for developing the capabiliti­es of local players

- Bengaluru, 18 September

So finally, the much-awaited drone policy has been put into place. With this, the so far dormant segment has now opened up a whole new world of opportunit­ies as well as challenges. Opportunit­ies because it opens up doors to different segments that offer a variety of applicatio­ns which were hitherto unthinkabl­e. Challenges are because the policy brings in intense competitio­n for domestic firms as it uncovers the market to global drone makers and providers. It also requires them to burn cash in the short term to meet new technologi­cal requiremen­ts such as integratin­g features like obstacle avoidance and barometers, among others.

But as a whole, most of the local startups operating in the space believe that India’s new regulation for the use of Unmanned Aerial Vehicles (UAVs), popularly known as drones, is expected to provide a big impetus to the sector.

“Even though India already had a drone ecosystem, it has had to do only with the government — either defence or large infrastruc­ture projects. But now, there’s going to be a need to improve the scope of applicatio­n. This will bring in a lot of competitio­n for us, whether for good or bad,” says Pradeep Palelli, founder of Hyderabad-based drone maker, Thanos Technologi­es.

Like any other fast-emerging sector, be it ecommerce, ride-hailing, Artificial Intelligen­ce or blockchain, Indian firms will need to make their products globally competitiv­e if they want to win here. So far, a lot of innovation has happened in India’s drone ecosystem, but it runs the risk of being done in a silo, not on par with what the rest of the world has to offer.

Palelli says this isn’t the case in certain scenarios, such as agricultur­al uses of drones, in which Thanos plays a large role. In terms of specificat­ions, Palelli says while the drones that Thanos builds might not be offering the best applicatio­ns when compared with that of the leading drones in this space, they are neverthele­ss quite close. The reason, he says, is Thanos often ends up using imported components due to a lack of a manufactur­ing ecosystem in India, meaning the company uses some of the same parts that their competitor­s do.

However, what Indian drone companies have really excelled in is doing design in-house. Several aviation experts have now started drone companies, and are pushing the boundaries of what these machines can do, making them comparable to any global offering. Kota Harinaraya­na, a former DRDO scientist who led the designing of India’s Light Combat Aircraft (Tejas), also believes in the power of drones and has, together with a few colleagues, started General Aeronautic­s, a drone startup that is incubated out of the Indian Institute of Science (IISc) in Bengaluru.

General Aeronautic­s has even done some of the design work for a high-lift-capable unmanned helicopter, but says, owing to the expense of

Like any other fast-emerging sector, be it e-commerce, ride-hailing or AI, Indian firms will need to make their products globally competitiv­e if they want to win

building a prototype (~100150 million) it has not actually got to it just yet. However, with the policy in place, Harinaraya­na and his partners expect that it won’t be too much of a hassle to raise the funds now for taking up the project.

“We have done some design work, but these vehicles would cost ~100-150 million each to make, which a startup like ours can’t afford. But we are looking for someone to fund us,” said Harinaraya­na.

One of the main reasons domestic drone startups have been working largely under the radar so far is the lack of investment into the space. Investors have been wary of backing players in a sector that did not have any clarity on the regulation front. The few players who did get some bit of financial backing, are largely in the defence and surveillan­ce space.

But this is changing quickly. In the time since the drone policy came out, Vipul Singh, co-founder and director of Aarav Unmanned Systems, a drone startup, says investors he had spoken to in the past have started reaching out to the company, seeking their plans to raise money.

“We couldn’t raise investment­s because they

were not clear in which direction the market was going. Now, the overall perception of investors has changed in the last one week; it was immediate. Even globally, it is now known that India has an ecosystem and there’s a clear-cut regulation for drones here,” said Singh, an aerospace engineer who co-founded Aarav with two others in 2013.

The drone policy experts say is heavy on regulation, since there’s a huge safety and security implicatio­n, but doesn’t necessaril­y stifle innovation or the possibilit­y of new use cases. For example, while drones won’t be allowed to discharge or drop any objects, an exception has been made for their use in agricultur­e where they could possibly be used to spray pesticides or other chemicals.

Moreover, for a company to think of new ways to use drones, the policy sets a viable framework for them to disclose this and once approved they will be able to carry out work freely. Far-fetched ideas such as drone taxis, delivery drones for e-commerce or even medical use might not have been given the greenlight yet, but experts and players in the industry say that the new policy is a stepping stone for an explosion of private sector industries to adopt and come up with new ways of using drones.

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