India's War Tech Gap

DECODE THE NEWS

India’s Drone War Is On, But How Indian Are Its Drones?

What?

Between May 8 and 10, India and Pakistan witnessed their most intense cross-border drone activity to date. Over 300 drones were reportedly launched from Pakistan across 36 locations along the Line of Control (LoC), prompting India to deploy kamikaze-style drones, loitering munitions (drones armed with explosives), and real-time intercepts. But while the headlines focused on battlefield drama, The Core’s investigation uncovers a more urgent concern: how much of India’s drone power is truly homegrown?

Why?

India’s push for indigenised military drone systems has come a long way—but it’s still incomplete. While companies have made progress building drone airframes and basic electronics domestically, key components like propulsion systems, advanced sensors, and onboard artificial intelligence remain largely imported. And that’s a major vulnerability in a conflict scenario.

“Until we build our own electro-optical and infrared payloads, and real onboard intelligence, we’re dependent,” said Raj Kumar Pandey, CEO of Airbornics Defence. Captain Vishal Kanwar of PwC India adds that India still doesn’t manufacture gas turbines for long-endurance drones, limiting local capability.

The Implications?

Private firms are investing heavily in AI capabilities, but there’s a bigger problem looming. Without a centralised, government-supported infrastructure to train and test AI models for combat drones, India risks fragmenting its progress. “If every company teaches its own drone with different mission data, we become vulnerable,” Pandey warned. The real need is for a shared defence-grade platform to build and secure the intelligence that powers drones.

While government-backed schemes like Innovations for Defence Excellence (iDEX) and the Defence Testing Infrastructure Scheme are early steps, India still lacks the ecosystem needed for true autonomy. That urgency is compounded by scale: the drone sector is projected to grow from $1.33 billion in 2024 to $2.28 billion by 2028, according to consulting form PwC estimates. Unless India builds not just drones but the brains behind them, its indigenisation story will remain incomplete.

Coal’s Costly Comeback. India continues to lean on coal to meet power demands, especially during harsh summers, when renewables fall short. Financial Times reports that state-run Coal India Ltd will revive 32 defunct mines and start five new greenfield projects. Lack of investments remains a key challenge for renewable energy.

Impact: Meanwhile, Reuters highlights that many of India’s new coal-powered projects are in India’s driest regions, straining local water resources.

Forecast: Coal India managing director PM Prasad believes that India’s coal usage will peak by 2035 and “then it will flatten, then it will definitely come down by 2047 and be phased down by 2070”.

Jane Street Under Scrutiny. India’s market regulator SEBI is investigating Jane Street, one of the world’s largest algorithmic and quant trading firms, for potentially manipulating India’s stock indexes, Reuters reported.

Catch Up Quick: SEBI is probing trades made over three years to check if Jane Street took huge bets in banking stocks via derivatives and then influenced index prices through cash market trades.

Why It Matters: This is the biggest such investigation involving a global trading giant in India—and raises serious questions about fairness and control in the country’s fast-growing stock and derivatives markets.

EV Giants Turn Up Heat. Tata Motors is rolling out a Rs 35,000 crore investment plan to overtake Hyundai and Mahindra in India’s SUV and EV markets, Economic Times reported. Both Tata and Hyundai held 14% market share in FY25, continuing a close fight The Core has previously tracked.

Why It Matters: Tata leads India’s EV race with 38% share, but Hyundai is scaling up fast. Rivals like VinFast and MG are also crowding the space.

What’s Next? Tata aims to launch new EVs, expand charging points five-fold, and hit 20% EV penetration by FY27—all while chasing profitability in its EV unit.

Semiconductor Ecosystem Grows! India has approved special economic zone (SEZ) proposals by Micron and Semiconductor Technology India and Hubballi Durable Goods Cluster (Aequs Group) to boost domestic semiconductor and electronics manufacturing, following a key policy shift.

By The Numbers: Micron will invest Rs 13,000 crore in a 37.64-hectare SEZ in Gujarat; Aequs will set up an 11.55-hectare SEZ in Karnataka with Rs 100 crore investment. Minimum land requirements for SEZs in this sector have been slashed from 50 to 10 hectares.

Going Forward: The relaxed rules aim to attract capital-heavy, high-tech investments, reduce import reliance, and generate skilled jobs—laying the groundwork for a robust semiconductor ecosystem in India.

THE MEDIA ROOM

Why The Future Of Indian Cinema Depends On Its Writers

India's film industry has had a few bad years. And one of the biggest problems has been good story telling. It is also because while actors are paid very high amounts, there has been little investment in good story telling.

Sidharth Jain, founder and chief storyteller at THE STORY INK spoke to journalist Vanita Kohli Khandekar on the urgent need to nurture original voices. He said, "Unless we develop talent, I have to develop a real writer. I can't tell a machine to write a script for me. I need people who want to take this as a career. Why would somebody say you become a screenwriter if you're not going to get salary for the first 10 years of your life?"

Jain established THE STORY INK in 2018 to solve the storytelling problem for the industry. "Started with the first low-hanging fruit, which are ready-made stories in the form of, you know, published books. Focused on that for two years till COVID hit us," Jain said.

Jain also spoke about why Indian cinema needs more patrons and why real change will only come when creators, not corporates, are in the driver’s seat.

PODCAST

On Episode 602 of The Core Report, financial journalist Govindraj Ethiraj talks to Ajay Trehan, Founder and CEO at AuthBridge.

• Nifty hits 2025 high as markets gather strength

• How the froth in railway stocks highlights the valuations dilemma

• How lenders are scanning way more data points about you thank you think before clearing your loan applications

• Nvidia founder Jensen Huang gushes about the UK, says he will invest there

• Big payouts by companies as dividends

👥 THE TEAM

✍️ Zinal Dedhia, Salman SH, Kudrat Wadhwa | ✂️ Rohini Chatterji | 🎧 Joshua Thomas