Indian Economy News

Defence Atmanirbharta: Record Production and Exports

India’s indigenous defence manufacturing has expanded strongly, with production reaching a record Rs. 1,27,434 crore (US$ 14.36 billion) in FY24, supported by the Atmanirbhar Bharat initiative and sustained policy reforms. Rising budgetary allocations, including the increase from Rs. 2,53,000 crore (US$ 28.51 billion) in FY14 to Rs. 6,81,000 crore (US$ 76.74 billion) in FY26, reflect a continued commitment to strengthening military capability. Enhanced ease of doing business, liberalised Foreign Direct Investment norms, and structured programmes such as the Research, Development and Innovation Scheme worth Rs. 1,00,000 crore (US$ 11.27 billion) have accelerated industry participation across public and private sectors. The introduction of the Defence Acquisition Procedure 2020 and the Defence Procurement Manual 2025 has streamlined procurement, prioritised indigenous systems, and encouraged collaboration with start-ups, Micro, Small, and Medium Enterprises, and academia. Defence Industrial Corridors in Uttar Pradesh and Tamil Nadu have further boosted investment. At the same time, institutions such as the Defence Research and Development Organisation continue to deepen India’s design and innovation ecosystem.
India’s defence exports have also strengthened, rising to Rs. 23,622 crore (US$ 2.66 billion) in FY25, driven by simplified export rules, a fully digital authorisation system, and wider global acceptance of Indian platforms. Greater private sector participation, reflected in its larger export share, along with rising contract awards to domestic companies, has reinforced India’s position as a reliable partner in defence supply chains. With India targeting defence production of Rs. 3,00,000 crore (US$ 33.81 billion) and exports of Rs. 50,000 crore (US$ 5.63 billion) by 2029, ongoing reforms, technology integration, and capacity expansion are creating a modern, self-reliant defence ecosystem. This policy direction is enabling India to emerge as a globally competitive centre for defence manufacturing, innovation, and strategic capability.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.