The Drone Rules, 2021: India gears up for the next technological revolution

The Indian government recently released the draft of The Drone Rules, 2021 with an aim to strike a balance between safety and operability of drones. These Drone Rules aim at replacing the four-month-old Unmanned Aircraft System Rules, 2021 (UAS Rules) which were issued on March 12, 2021.

This is unquestionably a move in the right direction. The UAS Rules added numerous levels of operational complexity for all drone industry players. They required a multi-tiered licence and pricing structure for practically any type of drone-related activity. The stakeholders raised various concerns regarding the UAS Rules. In response to their concerns, the government released the draft Drone Rules and had asked for suggestions from stakeholders by August 5, 2021. Thereafter, the Ministry of Civil Aviation notified the Drone Rules, 2021 on August 25, 2021.

In this article, we aim to discuss some of the salient features of the Drone Rules, 2021 and analyse its impact on the foreign investment regime in India.

The new Drone Rules 2021, will apply to (a) anybody who owns, possesses, or is involved in the leasing, exporting, transferring, or maintaining an unmanned aircraft system in India; (b) all unmanned aircraft systems that are registered in India; and (c) all unmanned aircraft systems that are already operating in or above India [Rule 2 (1)].

In case of an unmanned aircraft system with maximum all-up-weight more than 500 kilogram, the provisions of the Aircraft Rules, 1937 shall apply [Rule 2 (2)]. These Drone Rules widen the scope of applicability, as the earlier legal regime governed drones only up to 300 kilogram.

Further, as per the Drone Rules, “drone” means an unmanned aircraft system, which is an aircraft that can operate autonomously or can be operated remotely without a pilot on board [Rule 3 (i) and (zb)]. Unmanned aircraft systems have also been divided into five weight categories based upon the maximum all-up weight (including payload) under these Drone Rules: nano (less than or equal to 250 grams), micro (more than 250 g but less than or equal to 2 kg), small (more than 2 kg but less than or equal to 25 kg), medium (more than 25 kg but less than or equal to 150 kg), and large (greater than 150 kg) [Rule 5].

This categorisation has been made to grant certain exemptions to nano and micro drones and for making it easier to operate these kinds of drones. For example, no type certificate shall be required for operating a nano drone [Rule 13(2)]. Further, a person does not require a remote pilot license to operate: (i) a nano drone; and (ii) a micro drone for non-commercial purposes [Rule 36]. Further, a nano drone may be operated without third party insurance [Rule 44].

To promote minimum human interface, the Union Ministry of Civil Aviation also announced the creation of a digital sky platform that would serve as a business-friendly single-window online system that permits approvals to be generated automatically.

As per the Drone Rules, every drone to be operated in India is required to conform to a type certificate [Rule 6] and obtain a unique identification number [Rule 14]. These procedures to obtain the type certificate and unique identification number have been simplified by filing of the requisite forms on the digital sky platform [Rule 9 and 15]. Further, the Central government will also be publishing a policy framework in respect of the Unmanned Aircraft System Traffic Management (UTM) on the digital sky platform to facilitate automated permissions [Rule 43].

The digital sky platform will definitely help in easing the permission process. It shall also include an interactive airspace map with green, yellow, and red zones delineating acceptable and prohibited drone flying zones. Drones cannot be operated in the red zone or yellow zone without prior permission [Rule 19 and 22]. However, drones will be allowed to operate without permission in the green zone [Rule 22(2)]. These provisions will facilitate the operability of drones.

The Drone Rules, 2021 have eliminated the requirement of seeking various permissions, which had been mandated under the earlier UAS Rules. The Drone Rules reduce the number of compliances from 25 to 5. Further, the government fees prescribed for seeking type certificate; issuance, transfer or de-registration of unique identification number; and renewal or issuance of renewal of remote pilot licence has been kept at a nominal amount of ₹100. Further, the government fee payable for grant or renewal of such an authorisation of remote pilot training organisation has been kept at ₹1,000 [Rule 46].

Further, a type certificate will be required only for operating drones in India and will not be required for manufacturing or importing a drone [Rule 6 and 13]. The process for obtaining a unique identification number for existing drones, or registering transfer of a drone to another person, or de-registering a drone in case the drone is permanently lost or damaged has also been simplified [Rule 16, 17 and 18].

The Director General of Civil Aviation (DGCA) also aims at coming up with standard operating procedures (SoPs) and training procedure manuals (TPMs) on the digital sky platform for self-monitoring by drone operators. Unless there is a major deviation from the established processes, no permissions will be required.

The Central government will also be notifying the safety measures to be installed on a drone. All persons owning a drone will be given a time period of about six months to adopt these safety measures. Some of the measures that must be adopted by every drone include: (a) ‘No Permission – No Takeoff’ (NPNT) hardware and firmware; (b) Real-time tracking beacon that communicates the drone’s location, altitude, speed and unique identification number; and (c) Geo-fencing capability, which will restrict the movement of drone within a defined airspace [Rule 12].

The State government, Union Territory administration or law enforcement agency has also been given the power to temporarily prohibit drone flights in a specified area (red zone) for a period not exceeding 96 hours in case of an emergency [Rule 24]. Further, any unmanned aircraft is also prohibited from carrying arms, ammunition, explosives and military stores, etc. without the permission of the Central government [Rule 27] and cannot carry dangerous goods unless in compliance with the law [Rule 28]. These provisions will help the Indian government safeguard national security.

The Drone Rules have also laid down the eligibility criteria and procedure for obtaining a remote pilot license and for getting permission to set up a Remote Pilot Training Organisation. These measures will ensure that drones are being operated by qualified and trained persons and in turn will ensure safety and security.

The government also seeks to give a boost to drones used for the purpose of research and development. Such drones will not be required to obtain a type certificate, unique identification number, prior permission and remote pilot licence if the drones are being operated within a green zone [Rule 42]. Additionally, a framework for developing corridors for freight delivery by unmanned aircraft systems will be formulated [Rule 43(2)(a)], and an Unmanned Aircraft Systems Promotion Council will also be established to facilitate the country's drone-friendly regulatory system [Rule 45]. This Council will also encourage establishment of incubators for developing drone and counter-drone technologies.

The Drone Rules also encourage operation of drones approved by foreign regulators. The DGCA may also issue type certification to such drones based on approvals given by foreign regulators [Rule 10]. Further, drone activities by foreign-owned firms registered in India are not restricted. However, import of unmanned aircraft systems will be regulated by the Directorate General of Foreign Trade [Rule 11].

According to the Federation of Indian Chambers of Commerce and Industry (FICCI), India's drone and counter-drone market potential would be over $40 billion by 2030, with defence and homeland security accounting for half of it. Additionally, India will have more than 5,000 certified drone pilots (commercial and military) by 2025. The present proposal is a positive step that will help facilitate foreign investments in drone technology in India and further boost the Indian economy.

Despite the recent security concerns relating to drones, the Indian government has pushed through this streamlined law, and aims to balance between commercial and national security interests. The Drone Rules also focus on the development of counter-drone technologies to meet the threat presented by rogue drones.

The new Drone Rules, 2021 streamline the registration procedure and emphasises the notion of light-touch monitoring. Businesses that have been planning to use drones for deliveries and for the purpose of research and development will gain greatly from the new Drone Rules. This legal development will definitely gear India for the next technological development.

Please do share with us your comments or queries with respect to the Drone Rules, 2021 by writing to us on mumbai@singhanialaw.com.

Krrishan Singhania is the Founder and Managing Partner and Srishti Singhania is a Senior Associate at K Singhania & Co, Advocates and Legal Advisors.

The authors would like to thank Nishi Shah for assisting them in writing and researching for this article. Nishi is a Company Secretary and is pursuing law from Lala Lajpatrai College of Law, Mumbai.