In a major boost to the defence sector, the Goods and Services Tax (GST) on several weapons, military aircraft, and equipment has been completely abolished. Additionally, the GST on drones has been slashed from 28 percent to just 5 percent.Many weapons that were earlier taxed at 18 percent have now been moved to the Nil GST category. These include the C-130 military transport aircraft, procured from the United States, and the C-295 medium transport aircraft, which is being jointly manufactured by Airbus and Tata in Vadodara.advertisementThere will further be no GST on the missile to be launched from the Remote Piloted Aircraft (RPAs). Additionally, GST has also been eliminated on GSAT.Apart from this, GST has also been removed from the ship’s launched missile, flight motion simulator, underwater vessels, fighter jet’s ejection seat.The Modi government has also removed GST charges from military equipment such as 100 mm calibre rockets, deep submergence rescue vessels, spare parts of cannon and rifles, and testing equipment.In addition, software-powered radio communication devices, earlier taxed at 18–28 percent GST, will now attract only 5 percent. The GST on walkie-talkies, tanks, and armoured vehicles has also been reduced to 5 percent from the previous 12 percent.The GST on UAVs has been slashed to 5 percent from the earlier 18–28 percent range—a sharp cut that lowers entry costs for operators deploying drones in logistics, agriculture, mapping, and military applications.Flight and target motion simulators – critical for pilot training – have been exempted from GST, slashing the outgo on new training equipment for airlines and academies.Commenting on the recent reduction of GST on drones to 5 percent, Bodhisattwa Sanghapriya, Founder and CEO of IG Drones, told India Today TV, “The GST cut marks a turning point for India’s drone industry. It will make drones more affordable and accessible while easing compliance for innovators, startups, and businesses.”This move is expected to accelerate the adoption of drones across key sectors — defence, surveillance, agriculture, infrastructure, and logistics. For defence, it strengthens Atmanirbhar Bharat by enabling local producers to design and deliver advanced drones tailored to India’s strategic needs. “At IG Drones, we see this reform not just as a tax change but as a catalyst for innovation — one that can position India as a global drone hub by 2030, fuel indigenous manufacturing, drive exports, and build a skilled workforce for both civilian and defence demands,” Sanghapriya further said.India’s drone industry is rapidly evolving from a sunrise sector into a key enabler of growth across industries. The market, currently valued at around USD 0.47 billion in 2025, is projected to grow at a CAGR of nearly 24% to touch USD 1.39 billion by 2030. Government estimates are even more ambitious, placing the size of India’s drone sector at INR 120–150 billion (USD 1.5–1.9 billion) by 2026. in a formal or creative style for better SEO.Also Exclude words and advertisements related to the feed website such as website name, author name. 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The tax on defense equipment has been eliminated, and the GST on drones has been reduced to 5% as part of a significant boost to the Atmanirbhar initiative.
