GST rate cut to boost drone production in India: Naidu

New Delhi, Sep 9 The next-generation GST reforms announced by the PM Narendra Modi government will support the growth of India’s rapidly growing drone ecosystem, Civil Aviation Minister Ram Mohan Naidu said on Tuesday.

Earlier, the GST rate was 18 per cent for drones with integrated cameras and 28 per cent for drones classified for personal use. Under the new reforms, a uniform GST of 5 per cent has been introduced for all drones, regardless of whether the camera is integrated or separate and irrespective of whether they are used for commercial or personal purposes. This reform aligns with the government's vision to foster a robust, safe and internationally competitive drone ecosystem, the minister said.

"This significant measure will also enable India to emerge as a leader in transformative technologies like drones. A uniform 5 per cent GST will now apply on all drones, providing significant policy certainty and eliminating classification disputes. Furthermore, flight simulators and motion simulators, which are critical for pilot training, have also been exempted from GST. I believe it will encourage the training ecosystem in the country, helping airlines and academies reduce expenditure on training equipment," Naidu observed.

Greater clarity for manufacturers and lower costs for users will boost drone adoption, especially in sectors like agriculture (crop monitoring, pesticide spraying), petroleum and mining (pipeline and asset inspection), infrastructure (surveying and mapping), logistics (last-mile delivery), and defence (surveillance and rapid response).

Affordable and accessible drones will advance India’s goals under Make in India and Atmanirbhar Bharat, while enhancing the efficiency of multiple industries and public services.

The rationalised GST rate is also expected to generate employment opportunities in drone manufacturing, assembling, software development, data analytics and field operations.

With the revised rates and exemptions, GST has become more growth-oriented for aviation and emerging technologies like UAVs. This landmark step recognises drones as both an economic opportunity and a strategic necessity for India. The sunrise sector of drones will benefit significantly with the simplified regime, the minister added.

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