Things were so desperate that the company actually stationed an executive in Delhi for over two months, all to get the elusive greenlight for its drones. Why elusive? Because the Indian government’s policy on drones—the Civil Aviation Requirements (CAR), formulated by the DGCA in August 2018—practically rendered all commercial drone operations in the country illegal.
It requires, among other things, operators to register their drones and seek clearance online every time they want to fly. The key consideration was security, and understandably so, given the military and surveillance potential drones hold.
The plan sounded great on paper. Map the country into three zones:
Red—No-fly zones
Green—Flying zones
Amber—Zones requiring special permissions
And regulate drone flying accordingly. The rules, derived under the Aircraft Act of 1943, were enforced by December 2018. Drones also needed another feature—essentially, a kill switch—which would allow for the government’s vision of ‘no permission, no takeoff’ (NPNT).
While the CAR didn’t lack in terms of vision, execution was a whole other problem. The digital portal required for automatic approvals—an online platform called DigitalSky—is still not ready. Neither have the maps been properly demarcated. While a beta version was launched, it was pointless in the absence of a zone map.
The beta version was supposed to be an interim measure to provide the digital permission, said an executive working closely with the Drone Federation of India (DFI). Industry executives and drone companies The Ken spoke to have been told by officials that DigitalSky will only be operational in another six to 12 months.
In the absence of this digital infrastructure, drone operators were hamstrung—flouting these rules could lead to punishment as severe as imprisonment. While India has an estimated 40,000-60,000 drones, according to industry sources, the only way to continue in business is what Quidich did—lobby regulators incessantly.
In the end, Quidich did get the exemptions it needed to operate during the IPL. However, according to an industry executive and a government official aware of the matter, this was an arduous process. It involved phone calls to everyone, from the Board of Cricket Control in India (BCCI) to the Prime Minister’s Office, and the aviation ministry.
The system wasn’t always this broken. In fact, prior to CAR, operators could simply seek permissions offline. It was antiquated and cumbersome, sure. But it was still doable. The Pandora’s box, however, was opened when tech policy think tank iSpirt, as well as industry players, joined hands with the Indian government to take this modern technology into the digital age.
Skylark, a drone services company, came up with a testing module for NPNT. One of Quidich’s founders, Tanuj Bhojwani, would eventually join iSpirt after leaving the company, spearheading the think tank’s efforts with regard to shaping drone policy.
”If the government doesn’t build its own capacity, it will always be dependent on the external bodies, or people with no or limited expertise in drones,” says an industry expert who has worked closely on drone regulations, referring to the involvement of iSpirt in the entire drone policy. “Else you are simply betting on the intent of this external organisation,” the expert adds.
Interestingly, both iSpirt and Skylark representatives met with the world’s largest drone manufacturer, China’s DJI, to bring them in line with CAR regulations shortly before the policy came into effect. However, the Chinese drone major—which accounts for 80% of India’s commercial drones and two-thirds of drones globally—was unwilling to comply with the NPNT regime.
DJI’s refusal to play ball meant the vast majority of India’s drones fall foul of the law, effectively dealing a body blow to the space. The entire drone industry, which was already in just its nascency, shrunk after CAR, multiple drone companies and policy experts told The Ken.
Owning the drone policy
The drone industry is replete with examples of companies struggling as a result of CAR. Mumbai-based drone-mapping services company Indrones is one such. In 2019, it bagged a project worth Rs 1 crore (~$140,000) from the government of Punjab. The company waited in vain for four months for a CAR exemption. The contract was eventually scrapped.
While Quidich may have sorted out its IPL exemptions, the requirements imposed by CAR have led the company to focus more on overseas markets. “It’s easier to do business abroad,” admits Rahat Kulsheshtra, Quidich’s CEO. While even personal lobbying was no guarantee for permissions in India, Kulsheshtra says that they weren’t physically required to obtain approvals in other countries.
“The intention was fabulous,” says Anirudh Rastogi, founder of law firm Ikigai Law. However, he adds, CAR was too ambitious. “Instead of taking incremental steps, and building capacity of the regulators, it wanted compliance for an innovative policy from day one,” he explains. Rastogi has been closely following the drone policy formulation since 2015-16, and is currently advising the Drone Federation of India.
It is not new to see policy lag behind technology. However, the current state of affairs is especially pathetic given India woke up to the need for drone regulation half a decade ago. That was in response to a Mumbai eatery using a drone to deliver a pizza in 2014.
Alarmed by the scope for misuse of the technology, the DGCA outlawed usage of drones until policy could be drafted to regulate them. The Home Ministry was first to act, throwing together a draft legislation on drones in 2016. But it was the MoCA that eventually wrested control of the matter after Jayant Sinha took charge as Minister of State for Civil Aviation, according to an industry executive who has worked closely on drone regulation.
“Sinha had a sharp understanding of the subject and regulations,” the industry executive says, adding that Sinha intended for the drone policy to be his legacy. Both Sinha and then-civil aviation minister Suresh Prabhu envisioned India as a drone hub.
Despite their best intentions, though, the subsequent draft CAR policy—put forth in November 2017—was a shambles. To gain permission to fly a drone, one needed around 20 approvals from different agencies several days in advance. Unsurprisingly, the industry, think tanks, and drone enthusiasts in general weren’t pleased.
This is when iSpirt entered the picture. However, industry sources remain divided on whether Sinha approached the think tank or vice versa. The relationship between Sinha and iSpirt goes back to his tenure in the finance ministry, say multiple industry executives.
India to China and back
According to iSpirt’s Bhojwani, the Bengaluru-based body developed a prototype for DigitalSky, and demoed the same in early 2018. “We demoed our concept to DGCA and MoCA (Ministry of Civil Aviation), and even involved three industry participants who had built their own prototype NPNT compliance system,” he said. Following this, iSpirt signed a Memorandum of Understanding with the Airports Authority of India and the DGCA in November 2018, Bhojwani told The Ken via email.
At the time of the MoU, Bhojwani claims, the CAR policy was largely finalised, meaning iSpirt only had limited influence on the current version. Industry sources, however, claim iSpirt exerted a good deal of influence on the policy, beginning some time in 2017. The inclusion of DigitalSky—which iSpirt demoed in early 2018—in the policy lends weight to these claims.
And even as iSpirt worked on making DigitalSky a reality, a beta version of NPNT was developed by Skylark, says an industry executive who has worked closely on the policy. “The NPNT solution we built could be implemented with plugging additional hardware or simply downloading software application,” Skylark co-founder Mrinal Pai wrote in an emailed response to The Ken.
Conceptualising and mandating this tech, however, was the easy part. Implementing it would be far harder. Perhaps hardest of all would be ensuring the compliance of stakeholders. And one particular stakeholder above all—DJI, the $21-billion Chinese drone-maker. One of DJI’s sellers in India claims the company has an annual sales target of 3,000-4,000 units in the country, and that the majority of India’s drones were from DJI.
Prior to CAR going into effect, a group consisting of both Skylark and iSpirt representatives met with DJI at the latter’s headquarters in Shenzhen, China. Both Skylark and iSpirt claim they did not go together.
“Separately and then unknown to us, DJI and Skylark were already having conversations with DJI’s policy team (based out of Europe) and were already planning their trip to China,” says Bhojwani. “DJI’s policy team member suggested a joint meeting with iSpirt and Skylark, so that they could also fly over from Europe to China for just one trip, not two separate trips.”
While Bhojwani claims iSpirt was there to understand DJI’s concerns about NPNT, Pai says Skylark went to sell its NPNT solution to the company.
Despite meeting the two delegations, and having follow-up meetings with both, DJI has remained unmoved by India’s CAR demands. DJI’s public policy head Adam Welsh politely refused Skylark’s proposal, an executive working closely with DJI says. DJI has since stated publicly that it would wait for India to re-evaluate DigitalSky.
And without DJI’s compliance, CAR is either toothless or the vast majority of India’s drones are illegal. “You can’t just let the biggest drone player remain out of the regulatory ambit,” says Nitin Gupta, founder of Pune-based Flytbase, which has built an operating system for drones.
Best in the biz
Theoretically, DJI’s refusal to comply should have been a shot in the arm for Indian drone manufacturers, who no longer had to compete with the Chinese giant. According to industry executives, though, Indian manufacturers have a long way to go before their products can match DJI’s.
Most of the executives in the drone services space concur that the Indian manufacturers haven’t matched either price or quality. According to former Group Captain RK Narang, who has been associated with Centre for Air Power Studies, this is in no small part due to the lack of drone standards as well as an unsupportive taxation system. This makes it at least 15% more expensive to manufacture rather than import drones, according to an executive who works closely with the Drone Federation of India.
Consequently, the price of Indian drones in the 250g-2kg category, for example, is at least twice that of their DJI equivalents.
With both price and quality on its side, it’s little wonder that even the Indian military prefers DJI. “When it comes to critical operations, military agencies do go for DJI drones. Or if there is a need for bulk purchase, the agencies prefer procuring DJI drones without receipts,” says one drone supplier.
Globally, too, there are no comparable manufacturers, admits Neel Mehta, co-founder of Asteria Aerospace, a Bangalore-based drone maker. And there are enough lessons in the past for manufacturers who have tried competing with DJI head to head.
Camera manufacturer GoPro, for example, tried to get into the drone game but was unable to compete with DJI. Ditto for US drone company 3D Robotics, which soon pivoted to software as it couldn’t compete with its rival’s hardware prowess. Even DJI’s closest rival—European drone manufacturer Parrot—has given up on the consumer space, focusing solely on enterprise solutions instead.
“These businesses were killed either due to the price or because of the technological edge of DJI,” says Mehta. “It remains two to three years ahead of other players, in terms of technology, features, etc.”
Could Indian players catch up? Not on current form. In the absence of a suitable replacement, and with none on the horizon either, India’s drone space is stunted by DJI’s refusal to comply with CAR.
The new oil rigs
Already, the Indian government has a CAR 2.0 in the works. In January 2020, it shared a note on the changes it plans to bring in the second iteration of the policy. For this to truly be effective, though, it must first develop the capacity of both the regulator and the policy makers.
As of now, the DGCA doesn’t have a single official completely dedicated to drone-related matters. In stark contrast, the US regulator on civil aviation, Federal Aviation Administration (FAA), has over 150 people in its drone division.
According to an official who worked closely with DGCA in the past, a proposal to set a drone directorate has been circulating within the regulator. While the files moved last year, it isn’t clear what stage this is currently at, the official says.
Any directorate must have expertise in the drone space as well.“You need a mix of people—scientists or engineers who specialise in aviation as well as regulatory personnel,” says an executive with one of the drone companies.
Even as the government contemplates a new policy, though, India’s drone companies are starting to shift their focus. From hardware to software—the drone software market is estimated to reach $12.33 billion by 2022, according to a 2017 report by research firm MarketsandMarkets.
The future lies in the ability to extract accurate analytics from drone data using artificial intelligence and machine learning, says Mrigank Singh, CEO of Atal Incubation Centre at the Indian School of Business.
For instance, a surveillance solution is more than just the drone hardware. “The army and police, for example, tend to use three to five drones for event security purposes. Our software platform lets them monitor these live feeds from the command centre and perform real-time analysis,” says Asteria Aerospace’s Mehta.
“Drone technology is moving towards becoming a robust platform for data collection,” adds Singh. “Use of different sensors like multispectral, hyper-spectral, thermal, and high-resolution cameras allow for a range of applications like security, crowd management, mapping applications etc.” In the past, Singh ran a drone services company, SenseBird Solutions.
If data is the new oil, says Singh, drones are the new oil rigs. Perhaps there is still a drone goldmine for India after all.