Indian Army cancels 400 drones deal over alleged use of Chinese parts

In a major crackdown on domestic private sector companies, the Indian Army has canceled three contracts for the induction of 400 logistics drones worth over USD 2.3 billion over the alleged use of Chinese components. 

The contracts consist of 200 medium-altitude drones, 100 heavyweight drones, and 100 lightweight logistics drones. One of the impacted companies includes Chennai-based Dhaksha which was supplying logistics drones. Earlier in August 2024, the deal was put on hold due to the Army’s concerns over Chinese manufacturing components used in making the drones. 

These drones were meant for deployment along the 3,488-km Line of Actual Control with China in the wake of the military confrontation post-April 2020 after the Chinese army’s attempted incursions into eastern Ladakh.

As per reports, the defence establishment is also placing a “stringent mechanism” to ensure the military drones being acquired do not have “any Chinese parts or electronics as well as malicious codes.”

“Unfortunately, some Indian companies are using Chinese components and electronics in the drones they are producing for the armed forces. This is a major cybersecurity threat, with the possibility of data security and operations being compromised,” the Times of India reported citing an army source.

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“An adversary can seize control of a drone or ‘soft kill’ it through jamming. There may be a `backdoor’ in the electronics that bypasses security protection measures,” the source added.

Additionally, the Defence Ministry’s Department of Defence production has urged relevant industry bodies, such as FICCI, CII and Assocham, to “sensitize and caution” their member companies from procuring Chinese components for the manufacturing of drones and other defence equipment.

The armed forces is procuring a wide array of drones, ranging from nano, mini, and micro drones to kamikaze, logistics, armed swarms and fighter-size MALE (medium-altitude, long-endurance) and HALE (high-altitude, long-endurance) UAVs.