Drone Deliveries: What to Expect in 2023?

Logistics and e-commerce businesses worldwide are going through structural change as the world gets used to the pandemic’s aftereffects. Companies from all over the world have been offering solutions backed by cutting-edge technology in an effort to reduce delivery issues. As an emerging industry, drones are seizing this opportunity and are now being considered for various delivery applications in India.

The Central Government’s August 25, 2021 release of the liberalised Drone Rules, 2021, marked the beginning of the industry’s era. Additionally, on September 30, 2021, the government announced the production-linked incentive (PLI) scheme for drones and drone parts, which initially aided in its expansion. The year 2022 was also a pivotal one for the sector. The emerging industry has received support from the government, business, and related sectors, starting with Finance Minister Nirmala Sitharaman’s launch of Drone Shakti, a mission to make India a drone hub by 2030, and continuing with the Prime Minister’s emphasis on the technology’s use in various fields. Drones in every sector are anticipated to grow in 2023, including deliveries, due to domestic production, appropriate applications, private participation, and investments.

Drone deliveries: What does 2023 hold?

India has already used locally manufactured drones to deliver COVID-19 vaccines to remote and difficult-to-reach areas. The viability of using drones to deliver vaccines and medical supplies was evaluated as part of the “i-DRONE” project (ICMR’s Drone Response and Outreach for the North East). This was done in challenging geographic terrain, including on a land mass, an island, in foothills, and across hills. Drones were used to transport 17,275 units of medical supplies over a distance of 735 kilometres in just 12 hours.

For e-commerce, the expectations of on-demand and same-day deliveries significantly motivate sellers and logistics players to think beyond the existing vehicle-based logistics networks. Myriad logistics firms are turning to drone technology to address the inefficiencies in mid-mile logistics as a way to control operational costs while satisfying customer demand for on-demand and instant delivery.

Increased use in the mid-mile section

In order to address logistical issues involving the transit of goods from warehouses to mid-city fulfilment centres in the mid-mile section, a number of startups have emerged in the drone delivery space. Although many businesses are currently testing the use of cargo drones to transport various loads, it is likely that they will soon become the norm. In order to streamline the process, attention will also be paid to warehouse-to-warehouse movements, and a structure will be built that allows for total control over landing and takeoff zones.

More focus on infrastructure

India’s drone industry will concentrate on developing the necessary infrastructure in 2023 to make deliveries more efficient. To support a seamless delivery, a network and a process are needed. These networks will operate on a hub-and-spoke system, where the delivery hub serves as a hub for package storage, sorting, upkeep, and command and control of drones. The spokes are delivery or pickup points that are situated within a certain radial distance of the hub. To build a robust infrastructure, support will be required for drone technology features like integrated air traffic control, collision avoidance, and navigation management. Additionally, a big emphasis will be placed on providing ground support operators and drone pilots with the necessary training.

Drones-as-a-service to gain traction

According to the Civil Aviation Ministry, the Indian drone market is expected to reach between Rs 12,000 crore and Rs 15,000 crore by 2026, making it the next major tech disruption in the world. Nirmala Sitharaman, the finance minister, stated that the government would support start-ups to facilitate drone-as-a-service as part of the Union Budget. The fragmented drone industry in India is predicted to be consolidated and encouraged to work together thanks to the drones-as-a-service (DRaaS) model. As it eliminates the need for businesses to invest their own money in drone hardware and software, pilots, and pilot training programmes, it will allow businesses to take advantage of a variety of drone companies’ services. It is anticipated that the government will announce additional initiatives in the 2023 budget to encourage startups to offer drones as a service in response to the growing number of use cases and demand for drones.

All things considered

According to the most recent report from IMARC Group, the CAGR for the drone market in India is predicted to be 10.23% from 2023 to 2028. Furthermore, it is anticipated that the market will expand as a result of quick innovation, fierce competition, and significant price changes. Emphasis will also be on to resolve some obstacles in the way of the widespread use of drone delivery, including proper infrastructure and building a workforce of drone pilots. India will be requiring at least 100,000 drone pilots by 2024 according to Ministry of Information and Broadcasting of India.

Favourable government regulations from the Government of India will permit the use of delivery drones for commercial purposes, opening up lucrative market growth opportunities. Additionally, the industry will see a rise in the production of domestic drones, more use cases, and extensive research and development (R&D) efforts to address delivery challenges in 2023.

This article has been authored by Arjun Naik, Founder & CEO, ScanDron.

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