India is undergoing a significant transformation in defence technology, extending beyond military modernisation. The country is entirely redefining its strategic stance for the coming century. A vision of self-reliance, economic nationalism, and global ambition drives this evolution.
Public sector undertakings have led the growth of the Indian defence sector for decades. However, that model is now changing quickly. Indigenous systems are now fully operational, including the Tejas fighter jet, BrahMos missile, Akash air defence system, and advanced UAVs. They have transitioned from mere ideas to products ready for export.
This evolution isn’t just about strengthening the military; it’s also about enhancing its capabilities and restructuring India’s industrial economy. The government has set a notably ambitious target: reaching ₹50,000 crores (approximately $6 billion) in defence exports by 2029.
A strategically coordinated combination of Atmanirbhar Bharat, production-linked incentive (PLI) schemes, and public-private partnerships. The nation’s defence budget has seen a steady rise during the last decade, from ₹2.53 trillion in FY 2014 to ₹6.81 trillion in FY 2026.
The defence industry in India now plays a central role in a wider national policy shift that also includes semiconductor manufacturing, electronics exports, and increased engagement in the global value chain. The convergence of defence innovation and economic nationalism is transforming how India interacts with the global order — not merely as a buyer of the latest goods, but as a manufacturer and exporter of next-generation technologies.
This change is happening amid a boom in domestic and international demand for defence products. After Operation Sindoor in May, India registered the highest-ever defence production of ₹1.27 trillion in FY 2024, a 174% increase from ₹46,429 crore in FY 2015.
Global interest in India’s home-grown defence systems has surged. This aligns with the increase in global military expenditure, which rose to above ₹2.7 trillion in FY 2024.
India’s development highlights its rising status as an arms-producing hub. The expansion of local supply chains is supported by a competent supplier base and a skilled workforce. Joint ventures (JVs) and technology transfer (ToT) structures are also becoming more streamlined.
One notable example is the JV between the Defence Research and Development Organisation (DRDO) and NPOM of Russia, jointly developing, manufacturing, and selling the BrahMos supersonic cruise missile.
Hindustan Aeronautics Limited (HAL) has entered into direct investments, joint ventures, and strategic alliances with leading foreign defence industries, including Airbus, Lockheed Martin, and Rafael Advanced Defence Systems.
Manufacturing defence products domestically also provides India with huge cost benefits. Indian labour and manufacturing costs are relatively lower compared to other global production centres, giving India a competitive edge in the global market.
India’s rise as a defence manufacturing hub represents more than just military progress — it marks a convergence of economic strategy, industrial growth, and global influence. The shift toward indigenous production, advanced R&D, and strategic alliances is creating ripple effects across India’s broader economy.
From an investment standpoint, the defence sector is emerging as a high-potential growth theme. Public and private enterprises such as HAL, BEL, BDL, and L&T Defence are expanding operations, securing export contracts, and drawing investor attention. The government’s emphasis on self-reliance under Atmanirbhar Bharat and production-linked incentive (PLI) schemes has positioned defence manufacturing as a key pillar of India’s long-term industrial and export strategy.
For investors and policymakers alike, this transformation signals the beginning of a new chapter, one where India’s strategic strength and economic ambition reinforce each other, shaping the nation’s future as both a global security partner and an economic powerhouse.
Note: This post was generated with the help of AI.
