The Executive Yuan today approved plans to invest NT$44.2 billion (US$1.43 billion) into domestic production of uncrewed aerial drones over the next six years, bringing Taiwan’s output value to more than NT$40 billion by 2030 and making Taiwan Asia’s democratic hub for the drone supply chain.
The budget is to include NT$10.43 billion in existing funds and NT$33.8 billion in new allocations, according to the Ministry of Economic Affairs’ (MOEA) plan.
Under the new development program, the public sector would purchase nearly 100,000 drones, of which 50,898 would be for civil and government usage and 48,750 for national defense.
Photo: Screen grab from the General Atomic Aeronautical Web site
The Ministry of National Defense would fund its procurement through the special resilience budget.
Meanwhile, the Cabinet would direct the MOEA to establish an expert panel to provide policy guidance and require quarterly progress reports.
Taiwan’s competitive advantages in the drone industry include a complete supply chain for Information and Communication Technology (ICT) drones, rapid and flexible production capacity and a proven record of producing drones independent of Chinese-manufactured components, the MOEA said.
The nation currently has about 250 drone manufacturers, whose output value reached NT$5.05 billion last year, while Taiwan has signed eight memorandums of understanding (MOU) to enter supply chains with various countries worldwide, including the US, Japan, the Czech Republic and Poland, it added.
However, key gaps in Taiwan’s supply chain include thermal cameras, laser rangefinders (LFR), GPS chips, ground control software, flight controller chips and communication modules and chips, it said.
The industry still relies on imports for core components and suffers from a small domestic market that drives up costs, insufficient testing sites and industry standards and incomplete regulations, it added.
The MOEA proposed four key policy directions for the government to boost domestic production.
First, it would expand domestic and overseas demand by using the local market as a testing ground, supporting firms through strategic investment and pursuing global opportunities via a “national team” alliance, it said.
Second, it would strengthen indigenous research and development (R&D) and international cooperation to improve supply chain autonomy, with plans underway for 50 domestic projects and 10 international joint projects, it added.
Moreover, the government would subsidize R&D for flight controller chips, communication modules and AI-powered flight control software, it said.
Third, it would create a cluster ecosystem, including an innovation and R&D center and 18 testing sites, while the National Chung-shan Institute of Science and Technology’s Minsyong Campus would host 100 drone production firms.
The institute would further establish labs in Tainan's Shalun District (沙崙) and Lioujia District (六甲) to develop 26 types of drones, the MOEA said.
Last, it would amend regulations governing drones and uncrewed vessels, revise inspection standards and establish procurement and certification systems, it said.
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