India is preparing to place military drone orders worth over $2 billion with domestic manufacturers this year, marking the country's biggest-ever acquisition of unmanned aerial systems, according to Reuters reports citing an industry body closely associated with the government. The proposed purchase is in an advanced stage of planning with deliveries expected to be completed within 18-24 months. This represents a significant increase from recent government orders worth around ₹30 billion for tactical-class drones, with the Defence Ministry not officially commenting on the reported procurement plans.
Shares of drone manufacturers surged in Thursday's trade after the Reuters report, with Zen Technologies emerging among the top gainers on the NSE, rising 8.86% to ₹1,837.70 at 1:20 pm. Meanwhile, ideaForge Technology gained 5% to ₹900, hitting its upper circuit limit. Investor sentiment was boosted by expectations of a significant increase in defence spending on indigenous drone systems, as the procurement plan is expected to benefit domestic manufacturers through fast-track acquisition routes to meet urgent operational requirements.
The drone procurement surge coincides with growing counter-UAS technology partnerships, as evidenced by Ouster Inc.'s strategic agreement with Germany's ARGUS Interception. Under this partnership, ARGUS plans to incorporate Ouster's digital lidar into its A1-Falke interceptors, combining advanced short-range 3D sensing with drone capture technology. The A1-Falke system is designed to capture and recover unauthorized drones using an interception drone equipped with dual net launchers, combining radar, lidar, and depth-sensing cameras for autonomous interception and forensic analysis.
India currently has over 600 firms making drones and components, with more than 100 focused on defence applications, according to Reuters reports. The companies range from large players such as Adani Group, Larsen & Toubro and Tata Advanced Systems to startups like ideaForge, Newspace Research and Asteria Aerospace. They work on building reconnaissance, logistics, loitering munition, precision-strike and critical component systems. Speaking to Reuters, Smit Shah, President of Drone Federation India, indicated that the next phase of drone acquisitions could exceed ₹20,000 crore and may be executed through a fast-track procurement process aimed at meeting urgent operational requirements.
The move comes amid growing recognition of drones' role in modern warfare, with their extensive deployment during recent conflicts including the Russia-Ukraine war and tensions involving Iran transforming battlefield strategies while making advanced drone systems more affordable. In recent years, India has overhauled its typically slow defence procurement process to allow faster acquisition of drones, particularly after clashes with Pakistan exposed gaps in surveillance and strike capabilities. New Delhi has started relying on emergency procurement powers and swifter efforts under the Defence Acquisition Procedure, compressing timelines to months instead of years, while giving priority to systems made at home in its push to boost domestic manufacturing.
