India’s defence manufacturing marching towards self-reliance

“Self-reliance is not a destination but a journey, where every milestone strengthens the nation’s resolve to chart its destiny independently.” – Prime Minister of India, Shri Narendra Modi

One of the pillars of India’s developmental goals has long been the idea of Atmanirbharta, or self-reliance. India’s economy, which ranks fifth in the world, has continuously worked to strengthen domestic production in important areas including manufacturing, energy, technology, military, and agriculture while lowering reliance on imports. It represents the goal of building a strong, autonomous country that supports international stability and goes beyond economic progress.

The 2020 launch of the Aatmanirbhar Bharat Abhiyan, which was announced as a call to action during the pandemic, greatly accelerated the path towards Atmanirbharta. Reducing reliance on imported commodities, supporting domestic companies, and building an independent India were the campaign’s main objectives. Its ripple effects have been felt across various sectors, from infrastructure and healthcare to renewable energy and technology.

One of Atmanirbharta’s most important features is its capacity to instill a sense of pride and ownership in the country, enabling its people to take part in its development. Although the program includes a variety of activities, the defence industry best represents India’s progress towards independence as the nation shifts from being a supplier of weapons to a global centre for domestic defence production.

India’s defence sector a pillar of self-reliance

India’s defence history has been shaped by reliance on foreign suppliers. Post-independence, the country inherited a limited industrial base, and its nascent military depended heavily on imports for weapons and equipment. Wars in 1962, 1965, and 1971 further exposed vulnerabilities in India’s defence preparedness, emphasizing the need for indigenous capability. However, significant efforts to modernize the defence industry only began in the late 20th century.

India’s defence capabilities have seen a significant transition in the past decade. Make in India and Atmanirbhar Bharat are two policies that have given the indigenous military industry the much-needed boost it needs. By making significant expenditures in R&D and encouraging collaborations between public and private organisations, India has set the stage for its future as a major player in defence manufacturing.

India reached a significant milestone in FY 2023–24 with ₹1.27 lakh crore (USD 15 billion) in domestic defence manufacturing, which represents a significant 174% increase over 2014–15. About 65% of the nation’s defensive equipment is currently produced domestically, which is a significant change from the previous situation where 70% of its needs were satisfied by imports.

Indigenous defense manufacturing in India

Strong government initiatives like the Make in India campaign, which has made it possible to produce cutting-edge systems like the INS Vikrant, Dhanush Artillery Gun System, and Light Combat Aircraft (LCA) Tejas, are responsible for this accomplishment. Notably, 16 Defence Public Sector Undertakings (DPSUs), 430 licensed businesses, and more than 16,000 Micro, Small, and Medium Enterprises (MSMEs) support the private sector, which makes up 21% of this production. India’s emergence as a major global manufacturing powerhouse is demonstrated by the government’s ambition to produce ₹1.75 lakh crore (USD 21 billion) in defence this fiscal year and an even more ambitious ₹3 lakh crore (USD 36 billion) by 2029.

The recent establishment of the TATA Aircraft Complex in Vadodara, Gujarat, marks a key milestone. As the first private-sector Final Assembly Line (FAL) for military aircraft, this facility will produce 40 of the 56 C-295 military transport aircraft in India. Such initiatives are not just about manufacturing hardware—they represent the transfer of critical technologies and a robust defence ecosystem.

India’s surging defence exports

India has emerged as a key player in the global arms market. India now exports military hardware to more than 100 nations, with the United States, France, and Armenia being the major destinations. India’s defense exports have shown a significant momentum in the last 10 years, increasing by a sizable amount from USD 0.3 billion in 2014-15 to USD 1.3 billion in 2019-20 and surging to USD 2.5 billion in 2023-24. India’s defense exports increased by more than 700%, from USD 0.3 billion in 2014-15 to USD 2.5 billion in 2023-24. This record growth in export value is driven by government policies and initiatives supporting a strong manufacturing defense base. This indicates India’s unwavering commitment to make India a global manufacturing hub.

India’s defense exports trajectory from 2014-15 to 2023-24 (Value in USD billion)

Compiled from Annual Report of Ministry of Defense for 2014-15 to 2022-23 and Ministry of Defense

With a goal of ₹50,000 crore (USD 6 billion) in defence exports by 2029, the government has liberalised regulations and streamlined procedures to make doing business in this vital industry easier. These accomplishments support India’s economic expansion in addition to solidifying its standing as a trustworthy defence partner.

Strategic policies drive sustainable growth trajectory

India’s success in defence manufacturing is underpinned by forward-thinking government initiatives:

• Liberalized FDI Policy: The cap for Foreign Direct Investment (FDI) in defence was increased to 74% via the automatic route and 100% via the government route for technology-intensive projects.
• Budgetary Allocations: A record allocation of ₹6.21 lakh crore (USD 75 billion) for the Ministry of Defence in FY 2024-25 reflects the government’s commitment to modernization and indigenization.
• Priority Procurement: The Defence Acquisition Procedure (DAP)-2020 prioritizes domestic procurement.
• Positive Indigenization Lists: The embargo on importing 5,000+ items has catalyzed domestic production.
• Innovation Ecosystem: Schemes like iDEX (Innovations for Defence Excellence) and the establishment of Defence Industrial Corridors in Uttar Pradesh and Tamil Nadu encourage innovation among startups and MSMEs.

These reforms have paved the way for collaborative innovation, increased investment, and the development of cutting-edge defence technology.

A resilient future for defence sector

India’s defence revolution represents more than numbers—it is a statement of intent. By achieving record domestic production, soaring exports, and global partnerships, India is not only securing its borders but also strengthening its economy and global standing. The ambitious targets for production and export highlight India’s determination to become a global powerhouse in defence manufacturing.

As Prime Minister Shri Narendra Modi aptly stated, “The 21st century belongs to India.” This journey of self-reliance in defence fortifies the nation’s resolve to not only protect its sovereignty but to lead on the world stage with innovation, resilience, and a commitment to excellence.

In a nutshell, India’s onslaught in the defence manufacturing and defence exports has enhanced its strategic presence at the global stage. India’s tremendous growth in defence production and exports is attributed to the key policy initiatives and reforms undertaken by the Indian government. There has been an increased awareness and strategic sensitivity towards making India’s defence sector self-reliant. The clarion call for self-reliance has been present since Independence, but it has witnessed a new wave in the recent years.