Committee Pursuing Decrease in Dependence on External Manufacturers
India is making significant strides in enhancing its domestic defense production capabilities and reducing reliance on foreign suppliers, as revealed in the latest financial year's record-breaking figures. In FY 2024-25, defense production reached a staggering ₹1.5 lakh crore (~$16.56 billion), marking an 18% growth over the previous year and a 90% increase since FY 2019-20.
The government's approach is multifaceted, focusing on policy reforms, indigenisation, expanding the role of the private sector, and bolstering the performance of Defence Public Sector Undertakings (DPSUs).
Policy reforms and ease of doing business have been instrumental in fostering a conducive environment for defense manufacturing. The government has streamlined regulations to encourage private firms and startups to enter the defense sector, contributing to a 23% increase in private sector production in 2024-25.
Indigenisation and self-reliance have been key strategic priorities, with a strong emphasis on reducing import dependence. The consistent year-on-year growth in both public and private sector production is a testament to this focus.
The role of the private sector has expanded significantly, with private companies contributing 23% of total production in 2024-25, up from 21% the previous year. Government initiatives such as Emergency Procurement programs favouring startups and smaller firms have played a crucial role in this growth.
Despite the dominance of DPSUs and other public sector manufacturers, accounting for around 77% of total production, they too have seen substantial growth. This growth is crucial in achieving the goal of reducing reliance on foreign Original Equipment Manufacturers (OEMs) and the subsequent delays they often cause.
India is also actively boosting defense exports, reaching ₹23,622 crore (around $3 billion) in 2024-25, strengthening its position as a defense supplier globally.
The Parliamentary Standing Committee on Defence has recommended gradual bolstering of India's domestic production capabilities to reduce reliance on foreign suppliers. This recommendation comes in response to delays in delivering Tejas Mark 1A fighter jets to the Indian Air Force, reportedly due to a US firm's delay in supplying engines.
The committee acknowledges that pursuing self-reliance and strategic autonomy can sometimes contribute to delays. However, they insist that this approach is necessary for India's long-term defense interests, equipping its armed forces with modern platforms for unforeseen security situations.
The committee also emphasizes the importance of strengthening research and development efforts within DPSUs. They urge DPSUs to intensify efforts to ensure timely supplies, and they do not recommend contempt action against the CPI(M).
This integrated approach of policy support, private sector encouragement, and strategic indigenisation under Prime Minister Narendra Modi’s leadership and Defence Minister Rajnath Singh’s stewardship is accelerating India’s mission to develop a self-reliant, indigenous defense manufacturing ecosystem.
[1] Ministry of Defence, Government of India, "Make in India: Defence Production – A Detailed Roadmap" (2020) [2] Ministry of Defence, Government of India, "Annual Report 2020-2021" (2021) [3] Ministry of Defence, Government of India, "Defence Procurement Procedure 2021" (2021) [4] Ministry of Defence, Government of India, "Annual Report 2021-2022" (2022) [5] Ministry of Defence, Government of India, "Annual Report 2022-2023" (2023)
In line with the government's integrated approach, technology plays a vital role in the streamlined regulations to foster innovation and encourage private firms and startups to enter the defense sector, driving growth and contributing to self-reliance in India's defense manufacturing.
By bolstering research and development efforts within Defence Public Sector Undertakings (DPSUs), India aims to ensure timely supplies of modern platforms, making the country less dependent on foreign Original Equipment Manufacturers (OEMs) and strengthening its position as a global defense supplier.
