On Wednesday, February 9, the government announced some new rules regarding drones in the country. The import of drones has been banned in India which effectively blocks Chinese companies like SZ DJI Technology Co from being able to make the most of an emerging market like India.
The new rules, however, do allow the import of drone components without any approval, as the Directorate General of Foreign Trade (DGFT) said in its order.
"Import policy for drones in CBU (Completely Built-Up)/CKD (Completely Knocked Down)/SKD (Semi Knocked Down ) form… is prohibited with exceptions provided for R&D, defence and security purposes," DGFT said.
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All drones that are not a part of research and development (R&D), defence and security purposes come under these new rules, but these will still need due clearances, which includes the drones that cinematographers, travel photographers, bloggers, wedding and event planners, etc., use for their work.
The formal order to ban the import of drones comes days after the government issued the drone certification scheme to stipulate minimum safety and quality requirements that will help boost drone manufacturing in the country.
The notification of the certification scheme was announced on January 25 and is meant to help in "simpler, faster, and transparent type-certification of drones".
"If you are an R&D body, or a government-certified institution, or a drone manufacturing company, etc., you can import up to five drones at maximum for prototyping, testing, technology transfer with allied countries. Such imports by authorised institutions may be allowed after due approvals from DGFT and the permissions from line ministries," explained Chirag Sharma, CEO and Founder of Drone Destination.
Sharma added that since the government wants to balance equities and not stop the current use of drones, the import of components has been allowed. This is also because several of the drone components are not manufactured in India yet.
This follows the government mandates issued in August last year that had issued liberalised drone rules, a drone airspace map, and had also extended the PLI (production linked incentive) scheme to drone manufacturing.
The single-window DigitalSky platform was also introduced last year so that drone owners could easily register their devices.
These relaxed rules made it easier to acquire drone licenses and also allowed heavier payloads so that the devices could be used as unmanned flying vehicles and contactless delivery systems.
The need for services like these has peaked over the pandemic, particularly for the automated and contactless deliveries for groceries, medicines, and meals. Besides these "essential" needs, drones are extensively used in the country for photography and videography across media industries, weddings, and events.
The main ideas behind the ban on drone imports are two-pronged. Of course, security is one of the concerns that the government is trying to tackle, the other, the main one, is to boost local players in the drone space. This ties in with the Drone Shakti and the Kisan Drones initiatives that Finance Minister Nirmala Sitharaman announced during Budget 2022.
On one hand, banning drone imports appears to be rather drastic and short-term effects are expected to plague all industries and consumers currently using drones, but everyone seems to have their sights set on long-term gains. And if that doesn't go as planned, there is always the grey market.
"For the drone ecosystem to flourish and for innovative new use cases to emerge, access to high-quality and economically-priced drone hardware is critical. As 90 per cent of drones used in India are imported, it will be curious to see how the industry adapts and addresses this development which could temporarily at least, derail some well-laid plans. It would have been welcome if the government offered some incentives to the industry to override this," said Mughilan Thiru Ramasamy, CEO & Co-founder Skylark Drones.
Also Read: Budget 2022: Drone industry gets a big boost
"We have the talent and the manpower to make drones an independent and self-reliant industry, but the current ban will upend the ecosystem for some time. However, it will also play a critical role in realising the government's vision of making India a global drone hub," Ramaswamy added.
One important thing Ramaswamy pointed out is the fact that policymakers also need to consider a regulatory mechanism that will favour and promote the use of India-made software for drones.
Drone Destination's Chirag Sharma, in agreement with this point, said the end goal is to manufacture the components, assemble the device in-house, and also create the proprietary software that can be used on it.
"If a drone has 100 pieces, players manufacturing in India have been able to achieve about 60 to 70 per cent indigenisation, 30 to 40 per cent still comes from outside," he explained adding that over the next few years this should change once local manufacturing picks up.
Speaking about how this current ban will affect drone users like cinematographers, wedding planners, etc., Sharma said the civil aviation ministry's mandate issued last year included the need for all drone owners to declare their devices online on DigitalSky. Currently, the Indian government has a record of only 25,000 to 30,000 drones out of which most are drones used for more casual purposes like videography, photography, etc.
"In the last quarter of 2021, the government granted a one-time amnesty scheme for all drone owners with DANs or drone acknowledgement numbers with an option to convert these to UINs or unique identification numbers, much like the RC or a license plate on a drone. All drones functioning in the country should have a UIN," Sharma said.
However, with most photographers and videographers buying their drones from the grey market, they don't have DANs, and thus no UINs either. With the new rules, effectively all such drones have now become illegal.
Drone owners had almost 18 months to register and legalise their drones, if they have not yet, that's an error on their part Sharma pointed out. "Many people did not declare their drones out of fear, but the government did give them time and chances," he said.
The standard argument for most of these drone owners for buying things off the grey market or from abroad is that there are no India-made alternatives right now, but it is expected to change over the next few years and the government's latest ruling is the first push towards that. While the new Made-in-India drones might be more expensive than what companies like DJI offers, Sharma believes the users will be willing to pay up.
Additionally, the fact that drones from companies like DJI might not be easily available now, and might also not be legal for use, is going to give the Indian players the push to develop faster and at scale to meet the requirements since there is a market waiting.
For now, though, Sharma does not see the new rules really affecting drone owners who are already on the wrong side of the compliance rules. "These guys have procured the drones from the grey market, they have been using them without declaring them, and they will continue to do so. People running these grey markets will also continue assisting buyers like these, but over time once Indian alternatives come in, this should stop," he said.
Cinematographer Mahadev Thakur is someone who has been using drones for a while now for his shoots, and he too sees this move as a positive one for the Indian players. "This will give Indian companies the incentive they need to start manufacturing drones in-house which is great. Currently, the work on this front seems to be rather slow, but once the new rules kick in, the requirements will rise and that should help fast-track development," Thakur said.
When it comes to his own work, Thakur does not see much disruption because vendors they rent equipment from are all stocked up. However, he does foresee an issue and a hindrance when it comes to training and R&D in his field.
"When we train others to use drones and also use them for recce, the chances of wear and tear are very high. And with the new rules, getting these drones repaired easily might become difficult for vendors which will put pressure on the stock they have. One thing will affect the other and we might see issues here," Thakur explained.
He pointed out though that since a lot of the equipment still comes from grey markets, that is expected to continue as is. Unless the drone industry in India takes this chance to pull their socks up and get working.
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