India’s indigenous defence production reached INR 1.27 trillion in financial year 2023–24, according to a press release issued by the Ministry of Defence. Defence exports for FY 2024–25 stood at INR 236.22 billion, with a notable increase in export authorisations and a growing base of domestic manufacturers contributing to the figures.
The data reflects increased activity across public and private defence manufacturers. Of the total defence production, 65% was attributed to domestic manufacturing. The private sector accounted for 21% of the total output, while 16 Defence Public Sector Undertakings (DPSUs), over 430 licensed companies, and around 16,000 micro, small, and medium enterprises (MSMEs) were also part of the supply chain. Since 2014–15, production has increased by 174%, rising from INR 464.29 billion.
Export and Licensing Data
Defence exports increased significantly from INR 6.86 billion in 2013–14 to INR 236.22 billion in FY 2024–25. Of this, the private sector contributed INR 152.33 billion, while DPSUs contributed INR 83.89 billion. Export authorisations grew 16.92% to 1,762 in 2024–25, and the number of exporters rose 17.4% year-on-year. Indian defence equipment is now exported to over 100 countries, with the United States, France, and Armenia among the major destinations.
Exported items included bulletproof jackets, Dornier Do-228 aircraft, Chetak helicopters, fast interceptor boats, and lightweight torpedoes. The government aims to achieve INR 500 billion in defence exports by 2029.
Notable Acquisitions and Manufacturing Projects
Several procurement contracts were signed during the year:
- The Ministry of Defence awarded Hindustan Aeronautics Limited (HAL) two contracts for 156 Light Combat Helicopters (LCH) Prachand, valued at INR 627 billion. Deliveries will begin in the third year and continue over five years. Over 65% of the LCH components are domestically sourced, involving 250 Indian companies and generating approximately 8,500 jobs.
- A contract was signed with Metrea Management for wet leasing a KC-135 Flight Refuelling Aircraft to train Indian Air Force and Indian Navy pilots.
- The Cabinet Committee on Security approved procurement of 307 Advanced Towed Artillery Gun Systems (ATAGS) and 327 High Mobility 6×6 Gun Towing Vehicles under the Buy Indian–Indigenously Designed, Developed, and Manufactured (IDDM) category. The contract is valued at INR 70 billion.
A record 193 defence contracts were signed in FY 2024–25, with a combined value of INR 2.09 trillion. Of these, 177 contracts (INR 1.689 trillion) were awarded to domestic industry, constituting 81% of the total value.
Research and Innovation Initiatives
The Innovations for Defence Excellence (iDEX) programme has supported 619 startups and MSMEs through 430 signed contracts and has opened 549 problem statements to date. The Ministry of Defence allocated INR 4.49 billion to iDEX and its sub-scheme, ADITI, for 2025–26. The ADITI scheme provides grants up to INR 250 million for projects in areas such as satellite communication, artificial intelligence, underwater surveillance, and semiconductors.
Procurement of 43 items worth INR 24 billion from iDEX-linked entities has been approved, with development projects worth INR 15 billion sanctioned as of February 2025.
Indigenisation Measures and Corridors
The Ministry’s Self-Reliant Initiatives through Joint Action (SRIJAN) platform lists over 38,000 items for indigenisation. More than 14,000 items have been successfully indigenised as of February 2025.
Additionally, five Positive Indigenisation Lists (PILs) have been released, detailing over 5,500 items with restricted import timelines. Over 3,000 of these have been indigenised.
Two Defence Industrial Corridors (DICs) in Uttar Pradesh and Tamil Nadu have attracted INR 86.58 billion in investments so far. A total of 253 Memorandums of Understanding (MoUs) have been signed, with a potential investment of INR 534.39 billion.
Other Developments
Key policy changes include:
- Liberalisation of foreign direct investment (FDI) up to 74% through the automatic route.
- Extension of defence licence validity to 15 years (extendable to 18 years).
- De-licensing of parts and components in 2019 to facilitate ease of doing business.
- Introduction of a digital export authorisation system, which issued over 1,500 authorisations in the past year.
As of March 24, 2025, 145 projects have been undertaken under the MAKE procedure, with 40 under MAKE-I (government funded), 101 under MAKE-II (industry funded), and four under MAKE-III (manufacturing through technology transfer).
The government has earmarked 75% of its defence modernisation budget—INR 1.115 trillion—for domestic procurement in the current fiscal year.
Outlook
India aims to reach INR 3 trillion in total defence production and INR 500 billion in exports by 2029. The combination of policy support, increased domestic capability, and structured innovation programmes continues to reshape the country’s defence manufacturing sector.