New Delhi: India is on the verge of finalising a landmark defence deal with US-based Shield AI that will enable the Indian Air Force (IAF) to acquire the advanced V-BAT combat drones while also establishing local manufacturing under a rare full technology transfer agreement.
This deal represents a significant shift in India’s defence procurement approach, moving from purely importing military hardware to co-developing and locally producing cutting-edge weapon systems.
As part of a $4.5 billion emergency procurement program initiated after Operation Sindoor, the Indian Ministry of Defence is in advanced talks to purchase enhanced V-BAT drones from Shield AI for $35 million—the ceiling for emergency contracts. Parallel to this, Shield AI and JSW Defence (a division of the JSW Group) have inked a $90 million joint venture agreement to transfer full drone technology to India.
JSW Defence will invest this amount over two years (with $65 million in the first year) to set up production facilities, comply with global manufacturing standards, and train Indian engineers and technicians to locally produce, assemble, test, and maintain V-BAT drones.
The partnership envisions not only fulfilling India’s defence needs but also positioning India as a global manufacturing hub for the V-BAT, which is already operational with international forces including the United States Marine Expeditionary Units.
The V-BAT is a Group 3 unmanned aerial system (UAS) featuring fixed wings and vertical take-off and landing (VTOL) capability, providing long endurance for intelligence, surveillance, and reconnaissance (ISR) missions.
Its patented ducted design enables a small logistical footprint and rapid deployment, making it suitable for frontline infantry, special forces, armoured, and artillery units in complex operational environments.
This collaboration marks one of the rare occasions where India has secured full technology transfer on a high-tech defence platform from a US firm, reflecting India’s evolving defence policy aimed at technological sovereignty and self-reliance in defence manufacturing.
The move aligns with India’s broader strategic goal under the Aatmanirbhar Bharat (self-reliant India) initiative to reduce dependency on foreign suppliers by fostering indigenous defence production and co-development.
In summary, the India-Shield AI deal for the V-BAT drones is a pivotal development expected to:
- Deliver advanced ISR drone capabilities to the Indian Air Force
- Establish a robust domestic manufacturing ecosystem through JSW Defence
- Transfer full technology, enabling local assembly, testing, and future upgrades
- Position India as a global production and potential export hub for these drones
- Represent a significant shift from import-oriented defence acquisitions to co-development and indigenisation
This comprehensive collaboration is set to boost India’s defence manufacturing capabilities as well as its strategic autonomy in military technology.
