Belgrade, Serbia – At the heart of the main hall of the Belgrade Partner 23 Defense Fair, an unusual display of drone technologies captured the attention of visitors.

Over three dozen mini loitering munitions armed with aerial bombs were spread across the conference hall floor in a swarm formation. To their right a white rotary-wing hexacopter drone, about the size of a grocery shopping cart, was displayed, equipped with two 120mm aerial bombs, and to their left, the same system in black carried two 81mm aerial explosives.

The Serbian manufacturer behind this demonstration is Belgrade-based PR-DC, which is showcasing the third-series of its primary system, the Ika bomber. The rotary-wing drone is powered by six electric motors and has a flight time of 30 minutes when carrying a 20kg (44 lbs) payload. It’s offered in gray, white and black, as well as with different armament sets, typically produced by local supplier Krúsik.

Jovana Jevtić, marketing manager at PR-DC, told Defense News that the firm is eying the international market more than the domestic one.

“Saudi Arabia has shown great interest in the Ika bomber(s) for its military, which is expected to become operational in the next month or two. We are actually holding a demonstration for them today at our offices, to show them its capabilities and allow them to practice controlling it themselves,” she said.

These platforms are among a sea drone systems presented at the fair. Such a vast range of available technologies highlights the rising level of competition in the market, as well as the challenges that exist within the Serbian drone industry, in part due to the country’s procurement strategy.

As Belgrade attempts to strike a balance between greater diversification of international suppliers and further expanding its own domestic business, it often appears to create dual rivalries. Serbian drone manufacturers, although they do share some level of cooperation, must also battle each other for limited funding and contracts, both at a domestic and international level.

This was exemplified in February at the IDEX arms fair held in Abu Dhabi, where Serbia’s president announced that the country would buy UAE-made loitering munitions despite a number of domestic alternatives.

These challenges were highlighted by a representative of the Military Technical Institute, the developer of the Sparrow drone, also known as the Vrabac. The aircraft institute, which is tied to the Serbian Ministry of Defense, unveiled an armed version of this system in 2022. Thus far, the primary user of the standard Vrabac has been the Serbian Armed Forces, though MTI is eager to market it internationally.

“It has grabbed the interest of many non-European countries, but the international market [for this industry] is fierce,” said an MTI representative, who wished not to be named. “We have also encountered some organizational and funding issues.”

The Serbian MoD appears to be focused on rectifying this situation, where in the last two months, it signed contracts with domestic factories for $55,8 million worth of weapons to be delivered to the country’s military.

“We export to customers worldwide, making profit from this, which we invest back into our defense budget and towards enhancing our domestic production capabilities,” Aleksandar Lijakovic, marketing director at Yugoimport-SDPR, a Serbian state-owned arms manufacturer, told Defense News.