Ottawa commits C$900 million to NRC to fast-track drones, quantum and other defence tech

The gleaming white Bombardier Global 6500 parked inside the National Research Council’s flight research hangar in Ottawa looked less like a business jet than a promise.

Flanked by the aircraft and a row of NRC drones, Industry Minister Mélanie Joly, Defence Minister David J. McGuinty and Secretary of State for Defence Procurement Stephen Fuhr announced on March 9 that the federal government will channel more than C$900 million through the NRC to accelerate homegrown defence and dual‑use technologies.

The money is the first major implementation step of Prime Minister Mark Carney’s new Defence Industrial Strategy, a multiyear plan that aims to tie Canada’s security commitments directly to industrial policy and advanced manufacturing jobs.

“Canada’s Defence Industrial Strategy will strengthen our domestic industrial base, create high‑quality jobs across the country and help Canadian companies compete and win globally,” Joly said.

Five funding streams, led by drones and a flying testbed

The funding will roll out over several years and is concentrated in five areas: drones and aerospace test platforms, quantum technologies, biomedical countermeasures, and support for small and mid‑sized firms through a new stream of the NRC’s Industrial Research Assistance Program.

At the center of the package is a push into uncrewed and next‑generation aerospace systems.

• Drone Innovation Hub: Ottawa will spend C$105 million over three years to establish a hub anchored at NRC facilities in Ottawa and Mirabel, Que. The hub will develop and test uncrewed aerial systems, counter‑drone technologies and related sensors, working with the Department of National Defence, industry and universities.
• Global 6500 research aircraft: The NRC will acquire and outfit a Canadian‑built Bombardier Global 6500 as a flying research platform. The government has earmarked C$459 million over five years to turn the aircraft into a testbed for new radars, electronic warfare suites, communications systems and other mission equipment.

McGuinty said those investments are intended to give Canadian companies a real‑world environment to prove their technologies and help the military field capabilities more quickly.

“Canada’s security depends on our ability to innovate at home,” McGuinty said.

Quantum, biosecurity—and a new lane for small firms

The remaining elements of the NRC package are smaller in dollar terms but signal where Ottawa believes future security threats will emerge.

• Quantum technologies: More than C$160 million will go to quantum science and technology with defence and security applications, including secure communications, advanced sensing and resilient navigation.
• Biomedical countermeasures: Roughly C$28 million is earmarked for biological threat response, including research tied to dangerous pathogens and pandemics.
• Defence Industry Assist (IRAP stream): The NRC will provide about C$244 million to small and mid‑sized Canadian businesses developing defence and dual‑use technologies, pairing advisory services with non‑dilutive funding to help move projects from prototype to market.

“Today’s investments will give Canadian industry the opportunity to deliver for the Canadian Armed Forces by innovating, competing and creating good‑paying jobs for Canadians,” Fuhr said.

How it fits Carney’s broader strategy

The March 9 announcement flows directly from “Security, Sovereignty and Prosperity: Canada’s Defence Industrial Strategy,” unveiled by Carney on Feb. 17. The strategy commits C$6.6 billion over five years, beginning in the 2025‑26 fiscal year, to reshape how the federal government buys equipment and how it supports defence‑related industries.

Ottawa estimates that defence procurements and related capital investments over the next decade could total C$470 billion. The government says the strategy is designed to ensure that domestic companies capture a larger share of that spending and a bigger slice of export markets.

According to the strategy, the government’s goals by 2035 include creating 125,000 “high‑paying careers,” increasing defence exports by 50%, boosting overall defence industry revenues by 240% and ensuring that 70% of defence acquisitions are awarded to Canadian firms.

Carney has linked those ambitions to Canada’s NATO obligations. After allies agreed at a 2025 summit in The Hague to aim for defence and security spending of 5% of GDP by 2035, Canada committed to reach the long‑standing 2% target in 2025‑26 and to move toward the higher benchmark over the following decade.

“[The strategy] will transform our military and defence supply chain – create good careers at home, open new markets for our businesses, and equip the CAF with the world‑class equipment they need to protect Canada and our Allies,” Carney said.

Applause from industry, pushback from peace groups

Industry and business organizations have largely welcomed the shift. The Canadian Association of Defence and Security Industries, which represents about 1,000 firms, called the strategy an “ambitious, landmark strategy.” The Canadian Chamber of Commerce said Ottawa has “listened to industry expertise and bet big on Canada,” while urging clear timelines and consistent execution.

Research universities also responded positively. The U15 group of Canada’s research‑intensive universities praised the strategy for recognizing academic research and for plans to create a Science and Research Defence Advisory Council linking universities, the NRC and federal granting agencies.

Peace and disarmament groups, however, have denounced the strategy and the NRC funding as a militarization of industrial policy. In a March 2 open letter, the Canadian section of the Women’s International League for Peace and Freedom and the Canadian Voice of Women for Peace urged Carney to cancel the strategy and redirect funds toward housing, climate action and social services.

The hard part: deficits, procurement reform and the “missing middle”

Fiscal pressures and public opinion could complicate the government’s plans. Canada is running sizable deficits and faces competing demands for housing, health care and climate spending. Polling has found broad support for meeting NATO’s 2% guideline but significant skepticism about rising to 5% by 2035.

There are also questions about whether Ottawa can deliver on the procurement reforms promised in the strategy. The plan creates a new Defence Investment Agency to centralize and accelerate major purchases over C$100 million, a sharp change from Canada’s history of fragmented procurement and long delays on major projects.

In March testimony in the Senate, legislators and experts described the NRC announcement as a strong signal of intent but pointed to gaps in how small and mid‑sized firms will be supported as they scale. Existing innovation programs often cap out at about C$10 million, while the Defence Investment Agency’s focus begins at C$100 million, leaving a financing “no‑man’s‑land” in between.

Mitch Davies, president of the NRC, framed the new investments as an extension of the council’s longstanding role, noting that the NRC has supported more than 975 joint projects with National Defence since 2021.

“For over a century, the National Research Council of Canada has advanced research and innovation that strengthen our nation’s defence and security,” Davies said.

Whether the C$900‑million package delivers on its promise will depend on factors that extend beyond the walls of the NRC hangar: sustained political will, the government’s ability to reform procurement, and Canadians’ tolerance for tying more of the country’s scientific and industrial future to defence.