India has made significant strides towards self-reliance in defence manufacturing. Defence production has more than doubled over the past decade, growing from ₹46,429 crore in FY15 to ₹1.27 lakh crore in FY24. The government expects this figure to rise to ₹1.6 lakh crore in FY25.
Robust Growth In Defence Manufacturing
Between 2019-20 and 2023-24, defence production grew at a compound annual growth rate (CAGR) of 12%, surpassing the 11.2% growth rate recorded in the government’s first term. On January 15, Prime Minister Narendra Modi commissioned three indigenously designed and developed naval combatants. These include INS Surat, with 75% indigenous components, and INS Nilgiri, designed by the Indian Navy’s Warship Design Bureau.
This push for indigenous defence production has also bolstered India’s export capabilities. Defence exports in FY24 reached ₹21,083 crore, marking a 33% increase from the previous year. Since FY15, defence exports have expanded tenfold from ₹1,900 crore.
Despite the robust growth, private sector participation in defence production has remained limited. Private firms accounted for only 19-21% of total production between 2016-17 and 2023-24, according to Defence Ministry data.
Defence public sector undertakings (PSUs) continue to dominate. Their share in total production rose from 54.6% in 2016-17 to 58.4% in 2023-24. Conversely, the share of new defence PSUs fell from 20% to 15.3% during the same period.
India’s defence manufacturing is not only meeting domestic needs but also strengthening its global footprint. The government’s push for self-reliance and export-oriented growth has laid the foundation for a more robust and sustainable defence sector.
Also Read: India’s Electronics Exports Surge 35% To $3.58 Billion In December; Reach 24-Month High
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