Uniform taxation rate to reduce prices and spur drone adoption across agriculture, defence, and infrastructure.
In a landmark move to support emerging technologies and industrial growth, the GST Council has approved a uniform 5 per cent goods and services tax (GST) on all categories of drones. The reform, announced at the 56th GST Council Meeting, marks a significant step in rationalising India’s indirect tax regime and advancing its drone manufacturing ecosystem.
Previously, drones with integrated cameras attracted 18 per cent GST, while those classified for personal use were taxed at 28 per cent. The new uniform rate is expected to reduce drone prices by over 72 per cent, regardless of camera configuration or intended use, commercial or personal.
“This significant measure will enable India to emerge as a leader in transformative technologies like drones,” said Ram Mohan Naidu, Union Minister for Civil Aviation. “A uniform 5 per cent GST provides policy certainty and eliminates classification disputes.”
The reform aligns with the government’s broader vision to foster a safe, competitive, and globally relevant drone ecosystem. It also supports national programmes such as Make in India and Aatmanirbhar Bharat (self-reliant India), while enhancing operational efficiency across sectors, including agriculture, mining, infrastructure, logistics, disaster management and defence.
Smit Shah, President of the Drone Federation of India, welcomed the move, stating, “The GST rationalisation is not just about lowering taxes; it recognises drones as a core technology for India’s future. A uniform 5 per cent GST removes pricing distortions and gives certainty to manufacturers and customers.”
Boost to Adoption and Innovation
The simplified tax structure is also expected to generate employment across drone manufacturing, assembly, software development, data analytics, and field operations. Industry stakeholders anticipate a surge in adoption and innovation, positioning India as a competitive player in the global UAV market.
Ankit Mehta, CEO of unmanned aerial vehicle (UAV) manufacturer ideaForge, added, “With military UAVs now taxed at 0 per cent and commercial drones at 5 per cent, this policy enables Indian manufacturers to scale operations, expand defence contracts, and deliver cost-effective, high-performance drones.”
In a related announcement, the GST Council also exempted flight simulators and motion simulators used in pilot training from GST.
“This will encourage the training ecosystem in the country and help airlines and academies reduce expenditure on critical equipment,” Naidu noted.
According to CAE’s 2025 Aviation Talent Forecast, the Asia-Pacific region will require approximately 98,000 new pilots by 2034. India, now the world’s fastest-growing airline market, is expected to play a pivotal role in this surge.
-Manish Pant