Australia to develop new military drone

Australia will spend $40 million to develop a locally designed and developed military drone system.

Australia's defence forces will develop a new cheap, unmanned drone with aerospace giant Boeing to work alongside military planes.

"The partnership will produce a concept demonstrator of a low cost unmanned 'Loyal Wingman' aircraft, capable of operating in concert with Air Force's fifth-generation air combat capability," Defence Minister Christopher Pyne said on Wednesday.

Defence will invest about $10 million a year for four years to develop the drones, in partnership with universities and Australian defence companies.