Taiwan passes drone industry bill with plans for a "second protective mountain"

Aug 30, 2026

Taiwan's legislature has approved a major defense-autonomy and drone law, and the opposition KMT wants it to turn drones into the island's next chip-scale industry — good news for Taiwan's manufacturers if the money actually flows.

  • The bill sets aside around $40 billion Taiwan dollars a year for six years, roughly $240 billion in total, run by the economics ministry.
  • The KMT caucus, led by Fu Kun-chi, says Taiwan can build a full drone supply chain and become the world's biggest drone production base.
  • The cabinet plans to countersign the law and fold the spending into this year's extra budget, with changes to next year's main budget.
  • A new national strategy committee will oversee the plan, with party-nominated experts and public review reports, and the law includes items the U.S. side pushed for.
  • The pitch is jobs and export dollars: militaries everywhere are buying drones for asymmetric warfare, and Taiwan already has the IT supply chain to serve them.

Outlook: The fight now moves to whether the cabinet completes the countersignature and how the money gets divided — the next round of political trench warfare.

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