Since 2021, the Indian government has accelerated its efforts to create a strong Unmanned Aircraft Systems (UAS) or drones manufacturing ecosystem in India. Towards this end, we witnessed the liberalization of the regulatory regime concerning drones; Product Linked Incentive Scheme for drones and drone components and announcement of the Drone Shakti (Drone Power) scheme in Budget 2022.
Government's focus is to make India a global hub for research and development, testing, manufacturing, operation and export of drones. Drones are becoming increasingly relevant in almost all sectors such as agriculture, national defence, law enforcement, surveillance, geospatial mapping, and emergency response to name a few. Given India's size, drone technology is a definite boon, particularly in areas of agriculture, healthcare and emergency response.
Juxtaposed to this buzz is the ongoing dialogue on the need to establish a specific multilateral process, 'Drone Technology Control Regime', to develop standards for the design, use and export of drones since the existing multilateral regime, Missile Technology Control Regime (MTCR), which currently covers UAS, is being found wanting in its extant procedures.
Inarguably, UAS regulatory regime must be effective due to its potential for use in military and insurgent warfare. There are increasing instances across the world where drones are being (mis)used by non-State actors to inflict large scale damage to civilian lives and property. India is also no stranger to such misuse having been a victim of drone terrorism from its neighboring countries and has in place detailed SOP for the armed forces to counter drone terrorism.
As the use of civilian, commercial, and military drones expand, we examine the regulatory regime existing in India governing the manufacture, use, export and import of drones.
The Drone Rules, 2021
In March 2021, Government notified the Unmanned Aircraft System Rules (UAS Rules), which were regulatory and compliance intensive with numerous approvals, including unique authorization number, unique prototype identification number, certificate of manufacturing and airworthiness, certificate of conformance, certificate of maintenance, import clearance, acceptance of existing drones, operator permit, authorization of R&D organization, remote pilot instructor authorization, drone port authorization, and so on. The UAS Rules were superseded by the extant "liberal" Drone Rules, 2021 (Rules).1
It is noteworthy that the Government has chosen to regulate UAS as opposed to simply the Unmanned Aerial Vehicles (UAV), thereby covering the entire system required for advanced drone operations including the aircraft, ground control station, and communications system.
These Rules have been formulated under the Aircraft Act, 1934 (Act) and are regulated by the Director General Civil Aviation (DGCA) under the Ministry of Civil Aviation and provide for a licensing regime to regulate the owning, possessing, leasing, operating, transferring or maintaining an UAS in India. The Rules apply to UAS registered in, operated in or over India, with an all-up-weight of not more than 500 kilograms. UAS belonging to, or used by, the naval, military or air forces of India are excluded from the ambit of the Rules. These Rules also do not regulate the import or export of UAS, which are regulated by another Ministry, as discussed later.
UAS exceeding 500 kilograms will be subject to the provisions of the Aircraft Rules, 1937 also formulated under the Act, which regulate the flight, safety conditions, registration, airworthiness, apparatus used, logs maintained, communication, navigation and surveillance equipment etc. of all aircraft.
The Rules categorize UAS into aeroplane; rotorcraft; and hybrid unmanned aircraft system, which are further sub-categorized into remotely piloted aircraft system; model remotely piloted aircraft system; and autonomous unmanned aircraft system. These categories of UAS are classified, for purposes of certification, on the basis of maximum all-up weight, including payload, into:
- Nano UAS: weighing less than or equal to 250 grams;
- Micro UAS: weighing more than 250 grams, but less than or equal to 2 kilograms;
- Small UAS: weighing more than 2 kilograms, but less than or equal to 25 kilograms;
- Medium UAS: weighing more than 25 kilograms, but less than or equal to 150 kilograms; and
- Large UAS: weighing more than 150 kilograms, upto 500 kilograms.
Under the Rules, all UAS are required to obtain a Type Certificate from the DGCA, or any other entity authorized by the DGCA, certifying that a UAS of a specific type meets with the requirements under the Rules to be classified as that type. The certifying authority may choose to accept approvals given by specific foreign regulators. No Type Certificate is, however, required for the manufacture or import of Nano UAS and model remotely piloted aircraft system.
A person is allowed to operate an UAS in India only pursuant to its registration on the digital sky platform and obtaining a unique identification number. A remote pilot, or an individual charged by the operator with duties essential to the operation of an unmanned aircraft and who manipulates the flight controls during flight time, must also obtain a Remote Pilot Certificate from an authorized remote pilot training organization.
Transfer by way of by way of sale, lease, gift, or any other mode, is only permitted upon furnishing of details of the transferor, transferee and unique identification number.
The exempted categories for purposes of licenses under the Rules are:
- Nano UAS: Exempted from procuring a type license and remote pilot license
- Micro UAS: Exempted from procuring a remote pilot license
- Model remotely piloted aircraft system: Exempted from procuring a type license
Additionally, no certificate, license, permission is required for operating UAS for persons engaged in the following research, development and testing activities, provided these activities take place in the green zone and within the premises of the person where such research, development and testing activities are carried out:
- R&D entity under the administrative control or, or recognized by, the government.
- Educational institution under the administrative control or, or recognized by, the government.
- Startup recognized by the Department for Promotion of Industry and Internal Trade.
- Authorized testing entity; and
- UAS manufacturer having a Good and Service Tax Identification Number.
Operation of UAS
For operation of a UAS, the Central Government has published an interactive airspace map, segregating the entire airspace of India into red zone, yellow zone and green zone, with a horizontal resolution equal or finer than 10 meters. Prior permission is required for operating UAS in red and yellow zones.
The Rules expressly prohibit a person from carrying or cause or permitting to carry in any unmanned aircraft to, from, within or over India, any arms, ammunitions, munitions of war, implements of war, explosives and military stores, unless permitted.
Additionally, there is a specific requirement of not operating the UAS in a manner that endangers the safety and security of any person or property; and not carrying dangerous goods other than in compliance with the Aircraft (Carriage of Dangerous Goods) Rules, 2003 under the Act.
Operation of UAS in contravention of the above requirements of (i) prior permission to operate in the red and yellow zones, and (ii) carriage of arms, ammunitions etc. are cognizable and non-compoundable offences. For all other contraventions, the maximum penalty provided is INR 0.1 million.
With a view to incentivize manufacturing of drones and drone components to make India a global hub for research & development, testing, manufacturing and operation of drones, the Government introduced the Production Linked Incentive Scheme (PLI Scheme) in September 2021.2 Pursuant to the PLI Scheme, all manufacturers of drones and drone components whose annual turnover is above the below prescribed threshold are eligible for certain incentives:
(INR in Million)
|Indian MSME* and startups
Medium and Small-Scale Enterprises
PLI Scheme has a tenure of three years commencing from the financial year 2021-2022 with the benefits available for three consecutive financial years up to 2023-2024.
Since India is a member of three of the multilateral export control regimes, including the MTCR, and an adherent of the Nuclear Supplies Group, India has included the MTCR Control Lists in its own dual use list of Special Chemicals, Organisms, Materials, Equipment and Technology (SCOMET)3 to prevent unauthorized export and use for military purpose or in weapons of mass destruction. MTCR provides for regulation of export by its members of UAVs capable of carrying at least a 500 kg payload or carrying above a range of 300 km. MTCR also covers UAVs that have an autonomous flight control and navigation capability or capability of controlling flight out of direct vision range, involving a human operator and incorporating or designed to incorporate an aerosol dispensing mechanism with a capacity greater than 20 liters.4
In India, the export of UAVs is regulated by the Director General Foreign Trade (DGFT) under the Ministry of Commerce pursuant to its SCOMET policy. An export license must be procured from the DGFT before exporting UAVs under the SCOMET policy. Exports of UAVs and their related components and specifically designed equipment are subject to specific export authorisations to be obtained from DGFT when intended for civilian use and from the Ministry of Defence when the item falls under India's Munitions list, being Category 6 of SCOMET list.
Significantly, unlike the MTCR, which provides guidelines for UAVs carrying at least 500 kg payload or carrying above a range of 300 km, SCOMET does not provide for any thresholds in terms of weight or range for the UAVs. Hence, all UAVs would fall within the ambit of SCOMET and would require export authorisations for their export, transfer, re-transfer, brought-in-transit, transhipment of and brokering.
Import of drones is also regulated by DGFT. With effect from February 2022, DGFT has prohibited import of drones in completely-built-up, semi-knocked-down and completely-knocked-down form to promote homegrown production.5 Drone components, however, can be freely imported. The specific exemptions to this prohibition are import of drones:
- by Government entities, recognized educational institutions, R&D entities and drone manufacturers for R&D purpose subject to import authorization from DGFT in consultation with concerned ministries; and
- for defence and security purpose subject to import authorization from DGFT in consultation with concerned ministries.
UAS governance is still in its nascent stage in India where focus has only recently shifted to its manufacture and use. Given such nascency, the extant regulatory regime is serving its purpose. However, this nascent industry is now ready to take and wings and as India moves towards achieving its objective of becoming a global hub for drone manufacturing and its popular use, it would become imperative for India to review the Rules.
Most importantly, if India is indeed to become a significant player in export of drones, the SCOMET List must be reviewed to provide for acceptable thresholds for UAVs. This would enable export of UAVs below the regulated thresholds without attracting licensing requirement.
Second, DGFT may consider introducing an open general license for export of drones above the prescribed thresholds, subject to identification of end users and destinations; establishment of internal compliance programmes; post shipment reporting and so on. A robust export control regime governing UAS will go a long way in making India the desired drone manufacturing global hub.
One of the glaring infirmities in the existing Rules is the absence of a provision to safeguard the privacy of the data collected by the drones. As recognized by the Supreme Court in Justice K.S. Puttaswamy and Ors. vs. Union of India (UOI) and Ors.,6 Right to Privacy is now a fundamental right of every citizen of India and must be secured by procedural safeguards against excessive interference by the State. As stated above, all drones are required to be registered on the digital sky platform. The Rules provide nodal officers and law enforcement agencies direct and unfettered access to this platform.
Significantly, the above mentioned UAS Rules provided for express obligations on the operator to safeguard the privacy of persons and property during its operations and to ensure the privacy of individuals and their property while collecting video footage or image. However, such provisions are missing in the Rules, which superseded the said UAS Rules.
India has the potential for becoming the drone manufacturing hub with established regulations governing the manufacture, use, import and export of drones to add to its credibility. On the strength of its robust, yet industry friendly regulatory regime, it can replace China to become a responsible supplier of UAS in the region.
1. Drone Rules, 2021: https://egazette.nic.in/WriteReadData/2021/229221.pdf
2. PLI Scheme, 2021: https://egazette.nic.in/WriteReadData/2021/230076.pdf
6. Justice K.S. Puttaswamy and Ors. vs. Union of India (UOI) and Ors., (2017) 10 SCC 1: https://main.sci.gov.in/supremecourt/2012/35071/35071_2012_Judgement_26-Sep-2018.pdf
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