India's Defence Production Hits Record High of ₹1.51 Lakh Crore
India's annual defence production reached a record ₹1,50,590 crore in the 2024-25 fiscal year, an 18% increase from the previous year. This figure marks a 90% rise since FY 2019-20. The growth is attributed to the government's 'Aatmanirbhar Bharat' initiative, which aims to boost domestic manufacturing and reduce import dependency. While public sector undertakings accounted for 77% of the output, the private sector's contribution grew to 23%, reflecting its expanding role in India's defence industrial base.
Unpacked:
'Aatmanirbhar Bharat' is a government campaign launched in 2020 to promote self-reliance across sectors, including defence. It emphasizes domestic manufacturing, reserving a large share of defence procurement for Indian companies, increasing FDI limits, and encouraging private sector participation, leading to record production and reduced import dependency.
The private sector's expanding role increases competition, innovation, and efficiency in defence manufacturing. It diversifies suppliers, fosters investment, creates jobs, and supports technological advancement, helping India become less dependent on imports and positioning it as a potential global defence exporter.
India's defence imports have declined since 2020, reflecting a shift toward domestic manufacturing. This aligns with the government's push for self-reliance, as evidenced by increased indigenous defence procurement and the growing capability of both public and private domestic producers.
Challenges include bureaucratic inefficiencies, inconsistent budget allocations, limited innovation at the factory level, and the need to balance domestic capability with strategic international partnerships. Achieving full self-sufficiency also requires sustained investment and overcoming technological gaps.