The Research Institute for Democracy, Society, and Emerging Technology (DSET) was recently interviewed by Al Jazeera to provide expert analysis on the current development and strategic applications of Taiwan’s drone industry. The report, In the shadow of China, Taiwan is building a drone army to stop an invasion, noted that although the government has launched the “National Drone Team” program and significantly expanded procurement, Taiwan still faces structural challenges in areas such as production scale, supply chain resilience, counter-drone technology, and battlefield integration. Achieving sufficient scale and diversified applications in Taiwan’s drone capabilities will require greater cross-departmental coordination and sustained long-term policy support.
In the interview, DSET Global Fellow Sunny Cheung told Al Jazeera that China holds a significant advantage in both drone manufacturing and electronic warfare, including the ability to effectively jam enemy drones and even mislead anti-drone systems. Drawing on the DSET team’s discussions with senior executives from many of Taiwan’s leading military and commercial drone manufacturers, he noted that most local firms remain concerned about China’s strong counter-drone and electronic warfare capabilities, and are unsure whether Taiwan’s domestically developed drones could, in a real combat scenario, break through enemy defenses and successfully carry out missions.
DSET Non-Resident Fellow Hong-Lun Tiunn pointed out that some “would-be drone makers” fear they could face the same fate as U.S. drone maker Skydio, which was sanctioned by China in 2024 for selling drones to Taiwan, potentially resulting in a loss of access to the entire Chinese market. Cathy Fang, DSET Policy Analyst of National Security Program, added that profitability remains the top priority for private enterprises; without adequate risk-mitigation mechanisms, companies may choose to exit the market due to concerns over possible Chinese sanctions.
Both experts stressed that, if the government wishes to encourage greater private-sector participation in drone manufacturing, it must provide more attractive financial incentives to address industry concerns over potential political risks.
DSET’s June report, Drones for Democracy: U.S.-Taiwan Cooperation in Building a Resilient and China-Free UAV Supply Chain, highlighted that Taiwan’s current military-grade drones remain heavily dependent on imported core components, including GPS modules, thermal imaging devices, positioning chips, and video transmission systems. The report also noted that even when these imports come from friendly countries, their prices are often significantly higher than those of Chinese-made parts—for example, a single SDR (software-defined radio) video transmission chip can cost as much as 10 times the price offered by DJI.
The government’s establishment this year of a dedicated UAV/USV task force is seen as a positive step toward a more coordinated and systematic approach to procurement, subsidies, budgeting, and research and development. However, logistical integration and the creation of sustainable financial mechanisms remain key challenges moving forward.
