Next-gen military drone production begins in Hyderabad with JSW Defence and Shield AI’s $90M UAS facility

Foundation stone laid for the Hyderabad-based VBAT manufacturing plant, backed by a $90 million investment and long-term technology transfer from US defence innovator Shield AI

In a landmark move for India’s defence manufacturing ambitions, JSW Defence Pvt. Ltd. has commenced construction of a next-generation Unmanned Aerial Systems (UAS) facility in Hyderabad. The project marks the beginning of a $90 million partnership between JSW Defence and US-based defence technology company Shield AI, setting the stage for large-scale production of military drones under a long-term technology transfer arrangement.
Located at EMC Maheshwaram in Telangana, the new plant will manufacture the VBAT drone system a fixed-wing, vertical take-off and landing (VTOL) intelligence, surveillance, and reconnaissance (ISR) platform already deployed by forces such as the United States Marine Expeditionary Units. With full Transfer of Technology (ToT) rights and a clear roadmap, JSW’s new facility will enable not just assembly but end-to-end production of these advanced unmanned aerial systems.

The project is aligned with the Government of India’s Aatmanirbhar Bharat vision and reflects a maturing ecosystem for indigenous defence capabilities. Expected to be operational by the last quarter of 2026, the facility will also create a domestic supply chain, workforce training systems, and a sustainable infrastructure for MRO (maintenance, repair and overhaul) services related to unmanned systems.
The foundation stone for the facility was laid by Mr. Parth Jindal of the JSW Group, in the presence of Shri Duddilla Sridhar Babu, Telangana’s Minister for IT, Electronics and Communication, and Industries and Commerce. The ceremony was also attended by senior officials from the Indian Armed Forces, the Telangana government, and Shield AI, marking a unified commitment to expanding defence capabilities in the country.

Mr. Parth Jindal, speaking at the ceremony, stated, “Today’s milestone signals a bold new chapter in India’s journey toward self-reliance in next-generation defence technologies. Our collaboration with Shield AI reflects our shared ambition to bring mission-critical, globally benchmarked capabilities to India and to build an ecosystem that will define the future of unmanned systems for the nation.”
He further added that the Hyderabad facility will not only serve Indian strategic needs but also function as a global production hub for the V-BAT drone platform, reinforcing India’s position in international defence supply chains.

The VBAT platform, with its patented ducted design, is capable of vertical take-off and long-endurance missions. It supports a broad range of ISR functionalities, from reconnaissance over hostile terrains to direct battlefield deployment with front-line units. Its compact logistics footprint makes it suitable for rapid deployment in diverse environments, adding versatility to India’s defence toolkit.
Mr. Sarjan Shah, Shield AI’s Managing Director for India, highlighted the strategic importance of this initiative. “Shield AI is proud to be working alongside JSW in creating an indigenous production ecosystem for the V-BAT. The establishment of this world-class facility sets in motion the joint vision of the JSW Group and Shield AI to deepen Indo–US defence collaboration built on trust, transparency and shared strategic priorities.”

The Hyderabad facility also serves as a symbol of technological diplomacy. With the US and India strengthening defence and trade ties, this project stands as a clear example of how industrial cooperation can align with shared geopolitical goals.
According to defence analysts, the significance of a VBAT manufacturing line in India cannot be understated. While India has made strides in UAV development, access to a proven, combat-deployed platform like VBAT now to be produced domestically will dramatically enhance its tactical ISR capabilities.

From pilot training to system integration and lifecycle support, JSW Defence plans to develop a full-service ecosystem around the drone. This approach not only builds domestic competence but reduces dependency on imports, a long-standing concern in the defence sector.
The Telangana government’s active support for the aerospace and defence sectors has made Hyderabad a preferred location for such high-impact projects. With existing infrastructure, skilled manpower, and state-level incentives, the region continues to attract global defence collaborations.

Industry observers also see this development as a potential catalyst for spin-off innovation. The convergence of aerospace engineering, AI, autonomy, and robotics within the VBAT programme may lead to new R&D investments and further strategic partnerships in the coming years.
The joint venture underscores JSW Group’s broader push into strategic sectors that go beyond its traditional industrial footprint. Backed by its industrial scale, supply chain capabilities, and financial strength, JSW’s move into unmanned systems may pave the way for more such collaborations in other defence technologies.

By creating one of the most advanced UAS production lines in the region, JSW Defence and Shield AI are laying the groundwork for a sustainable, export-ready, and technologically sovereign ecosystem in India’s defence sector.
As the foundation stone was laid, so too was a new vision: one in which India builds, operates, and innovates with defence technologies that are globally competitive and locally rooted.

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