States such as Andhra Pradesh, Madhya Pradesh, and Gujarat are developing drone clusters to encourage collaboration over competition, creating a unified national ecosystem

As India heads toward the Union Budget 2026, a lively debate has emerged over two sectors seen as crucial to national strength: energy and defence. Experts, entrepreneurs, and engineers came together recently to discuss whether India is truly ready to transform its ambitions into global leadership or if policy intentions are outpacing reality.

The debate began with a stark observation: modern security isn’t just about soldiers and weapons. Energy independence, drones, artificial intelligence, and supply chain resilience are now equally vital. Initiatives like Atmanirbhar Bharat and the National Green Hydrogen Mission have set ambitious targets, but the pressing question is whether India can back policies with execution.

In defence, the focus was on drones. Entrepreneurs painted a picture of the sector moving from “zero to hero” since 2016. The 2021 Drone Policy, they said, is one of the world’s most progressive, surpassing many European standards. India’s drone ecosystem now rests on four pillars: drone-as-a-service, manufacturing, training, and software development.

Government schemes such as Drone Shakti Yojana and the Production-Linked Incentive program have fueled growth. The first PLI phase allocated Rs 120 crore, with plans for exponential increases in the coming years. Experts linked this growth to modern warfare, citing conflicts like Ukraine-Russia and recent Indian military operations, where drones, AI, and robotics are reshaping battlefields.

States such as Andhra Pradesh, Madhya Pradesh, and Gujarat are developing drone clusters to encourage collaboration over competition, creating a unified national ecosystem. Entrepreneurs expressed pride that India’s policies are unique globally, positioning the country as a potential drone powerhouse.

Questions arose about India’s global competitiveness in defence tech. While some critics argue that India lags in R&D, industry leaders countered with operational successes and emerging export opportunities. Indian drones are being considered in markets like Russia, Africa, and parts of Asia for both civilian and military use. South Korea, advanced in software, is looking to India for development partnerships. Europe poses challenges due to NATO-linked restrictions, but overall, panellists emphasized that India’s policy focus across all pillars gives it a unique edge—provided government support continues.

The discussion then shifted to energy. Experts described India’s shift from ambition to execution under the National Green Hydrogen Mission. Companies producing hundreds of megawatts of hydrogen electrolyzers are benefiting from government incentives. Solar energy, they noted, has already made India a global cost leader.

Hydrogen, however, remains nascent. Experts described a “chicken-and-egg” dilemma: demand drives supply, but supply is needed to create demand. Unlike wealthier nations, India may not lead in cutting-edge R&D, but it excels in execution, cost efficiency, and indigenization. Green molecules such as hydrogen and ammonia could reduce fossil fuel dependence and open new export avenues.

Challenges in energy prompted lively discussion. Supply-demand imbalances, grid limitations, storage hurdles, and transport issues were flagged as major bottlenecks for scaling solar and hydrogen. Entrepreneurs stressed the need for on-site production due to logistical hurdles and the absence of strong security and storage policies. Battery energy storage systems (BESS) were highlighted as critical, with 8–10 gigawatts tendered in 2025–26, though most business still goes abroad.

To overcome these gaps, experts recommended government-backed “survival projects” for private firms to build capacity, train personnel, and reduce foreign dependence within two to three years. They also called for demand-side incentives, such as subsidies for industries using grey hydrogen, to accelerate a transition to green alternatives. Prioritizing 60–70% local value addition in batteries and renewables could also boost jobs, revenue, and infrastructure development.

The debate concluded with a consensus: India has strong policies and ambition in energy and defence, but execution remains the key challenge. Budget 2026 will play a crucial role in providing funding, incentives, infrastructure, and skilling opportunities to turn potential into tangible progress. As geopolitical tensions rise, these sectors are not just economic priorities—they are strategic imperatives for a self-reliant India.