Production and Proliferation: The Risks of the Burgeoning Iranian Drone Industry

Insikt Group assesses that Iran’s rapidly expanding UAV industry poses multifaceted risks to global businesses and governments, including compliance violations via illicit procurement, reputational exposure from Western components found in drones, technology transfer through reverse engineering, global proliferation of drone capabilities, and heightened cyber-espionage threats. Despite sanctions, Iran’s production and export—bolstered by partnerships such as with Russia—have accelerated, with drones used across multiple conflict zones. The report urges robust compliance programs, employee awareness on procurement red flags, strengthened cybersecurity against likely APT targeting of aerospace and drone firms, and coordinated government action to enforce export controls and disrupt supporting networks.