
Articles
India’s Defence Exports A Transformational Shift
Sub Title : Kudos to the indian defence industry which is setting new milestones in this relatively new domain – defence exports
Issues Details : Vol 19 Issue 1 Mar – Apr 2025
Author : Neeraj Gupta
Page No. : 43
Category : Military Affairs
: April 15, 2025

India is rapidly emerging as a key global player in defence exports, transitioning from an import-dependent nation to a trusted supplier of military systems. With record-breaking exports, strategic policy reforms, and technological advancements, Indian defence firms are making their mark worldwide, reinforcing India’s vision of self-reliance and global defence collaboration.
The global defence landscape has undergone significant changes in recent years, driven by geopolitical shifts, technological advancements, and evolving security challenges. In this context, India is emerging as a key player in the global defence industry, transitioning from a traditionally import-dependent nation to a budding hub for defence exports opening up a myriad of opportunities for the Indian defence industry in the realm of exports.
The Geopolitical Shift
India’s strategic position has amplified its importance in the global defence framework. As the balance of power shifts, there is a growing demand for enhanced military capabilities not just among major powers, but also amongst smaller nations seeking to bolster their security apparatus. India’s relationships with countries such as the United States, Japan, and Australia have grown stronger, particularly in the context of collaborative security initiatives and defence cooperation agreements.
This geopolitical backdrop serves as a springboard for Indian defence exports. The sector becomes strategically important with India increasingly focussed on defence diplomacy to build its international policy, this sector has become strategically important. The government’s commitment to enhancing bilateral relations through defence agreements stimulates the demand for indigenous products. This is exemplified in recent collaborations to produce sophisticated military technologies for both external markets and domestic use. It is also exemplified in the increasing importance being given to defence trade with countries hitherto influenced by other major powers.
Growth of Defence Exports in last decade
India’s defence exports touched a record Rs 21,083 crores USD 2.63 Billion) in FY 23-24, an increase of over 32% over the last fiscal. Significantly 60% of this was by the private sector. In the last 10 years defence exports have grown by a staggering 31 times! This increase showcases not only the growing capability of Indian firms but also the rising demand for Indian-built military hardware in various countries.
Policy Framework and Initiatives
The “Make in India” initiative, launched in 2014, aimed at encouraging domestic production, enhancing self-reliance, and attracting foreign investments. Key policies, such as the increased Foreign Direct Investment (FDI) cap in defence manufacturing, setting up of Defence Corridors have opened up the sector to private players, including foreign corporations, thereby fostering an ecosystem conducive to innovation and competitiveness.
Moreover, the Defence Production Policy and the Defence Export Strategy, both established in recent years, outline specific targets and action plans to boost defence exports. These policies are designed to facilitate technology transfer, encourage research and development, and promote exports of defence products and services.
Technological Advancements
Technological innovation is a critical driver of the changing scenario in defence exports. India has made substantial progress in developing indigenous capabilities in key areas, including aerospace, naval systems, land-based equipment, protection equipment and surveillance systems. Significant achievements in sectors like missile technology, unmanned aerial vehicles (UAVs), and advanced communication systems exemplify this progress. India is today acknowledged not just as a manufacturer and exporter of parts and components but is increasingly being recognized as a reliable manufacturer of major systems and platforms which are finding international acceptance.
The establishment of defence public sector undertakings (DPSUs), coupled with a growing number of private sector enterprises, has resulted in enhanced capabilities for producing high-tech defence systems and platforms.
Challenges Faced by Indian Defence Manufacturers
Despite the positive developments, there are several challenges which if addressed will propel the growth defence exports from India. The primary challenge is the bureaucratic red tape that often hampers the speed of decision-making and project execution. Lengthy approval processes for projects can delay the timely delivery of defence products to international markets.
Another significant barrier is the competitive landscape dominated by established international players. Nations such as the United States, Russia, and countries in the European Union have a well-entrenched position in the global defence market. Indian manufacturers often struggle to compete not just on technology but also on pricing and delivery timelines.
Additionally, a lack of a coherent strategy for international marketing and export promotion has limited the visibility of Indian defence products in global markets. Building brand equity on a global scale requires sustained effort and investment in marketing, trade fairs, and international collaborations.
Opportunities Ahead
Looking forward, the future of Indian defence exports appears promising. The growing emphasis on indigenization aligns with global trends towards sourcing defence products locally. Countries that have previously relied heavily on imports are now seeking to diversify their supply chains and enhance local capabilities – presenting a unique opportunity for Indian firms.
Furthermore, the shift towards dual-use technologies—which can be used for both civilian and military applications—provides a fertile ground for expansion. Indian companies can leverage their expertise in information technology and electronics to develop cutting-edge solutions that meet both defence and commercial needs.
The increasing global military expenditure, particularly in emerging economies and noticeable shift towards sourcing defence systems and equipment from countries other than the major exporters is also expected to bolster demand for affordable and efficient defence systems. Indian manufacturers can position themselves uniquely by offering cost-effective solutions, aligning with international standards while catering to the specific needs of potential clients.
Conclusion
The changing scenario for Indian defence exports is shaped by a convergence of geopolitical, technological, and policy factors. While challenges remain in the form of bureaucratic hurdles and competitive pressures, the opportunities for growth are substantial. Indian defence equipment is finding increasing acceptance globally for its reliability and technical competence. Besides with most of the emerging countries looking to unshackle the historical hold major superpowers have maintained on defence supplies globally, opportunities for the Indian defence sector are huge. At MKU we have been exporting consistently since 2003 and have been witness to the significant change in global perception for the Indian Defence Industry.
By leveraging its strengths and addressing the existing gaps, India has the potential to become a significant player in the global defence export market. The commitment to self-reliance, paired with strategic international partnerships, will pave the way for a resilient, vibrant, and export-oriented Indian defence industry in the years to come. With the government pitching defence as not only a strategic sector but also as a major contributor to the growth of the manufacturing sector, defence industry in India is poised to grow exponentially and exports will further propel this growth.
