India has risen as a significant player in the global arms market, with its defence exports growing over 1000% in the past eight years. These exports now reach over 85 countries worldwide, placing India among the top 25 defence exporters globally, with over 100 firms actively involved in exporting defence products.
The South Asian country stands out as a resilient exporter of defence products in a world characterized by a turbulent, ever-changing, and unpredictable geostrategic landscape. It offers a diverse range of defence products to nations around the globe.
India’s onslaught in defence manufacturing has enhanced its strategic presence on the global stage as its defence production has expanded from coastal surveillance systems and naval vessels to missiles and rocket launchers.
India is now positioned as a reliable supplier in the global arms trade. Its defence exports reached an all-time high of Rs. 21,083 crores in 2023-24, up from Rs. 15,920 crores in 2022-23, representing a 32.5% growth.
India’s tremendous growth in defence production and exports is attributed to key policy initiatives and reforms undertaken by the Indian government. There has been increased awareness and strategic sensitivity towards making India’s defence sector self-reliant.
The clarion call for self-reliance has been present since Independence, but it has witnessed a new wave in recent years, particularly post-COVID from 2021 onwards.
Key reforms implemented by the government, such as simplifying the industrial licensing process with a longer validity period, rationalizing the defence product list requiring industry licenses, and liberalizing the foreign direct investment (FDI) policy to allow 74% FDI under the automatic route, have been steps taken to enhance indigenous production and exports.
The establishment of the Defence Innovation Organisation in 2018 promoted innovation in the defence sector and increased outreach to produce state-of-the-art defence products. It has become the focal point for collaboration between academia, the private sector, and the defence industry.
Additionally, the release of the Defence Production and Export Promotion Policy (DPEPP) in 2020 (following the Defence Production Policy 2011, Defence Production Policy 2016, and Defence Export Promotion Policy 2018) has provided a significant boost to the defence industry in India.
This policy aims to achieve a turnover of $25 billion in defence manufacturing, including $5 billion in exports, by 2025. It achieves this by simplifying export procedures, enhancing the ease of doing business in the industry, and creating a favourable environment for defence exports. The offset clause in the policy is an important mechanism available to the domestic industry to enhance their export capabilities.
India is also participating regularly in international defence exhibitions and events such as DefExpo and Aero India. These platforms showcase India’s defence products and technologies to potential buyers worldwide, leading to noteworthy networking, collaborations, and defence deals.
The Defence Exports Steering Committee and Export Promotion Body play significant roles in coordinating and promoting the export of defence products from India.
India has launched several initiatives, including Mission DefSpace involving the three services in the space domain, the Innovations for Defence Excellence (iDEX) scheme involving start-ups and micro, small, and medium enterprises (MSMEs), and an indigenisation portal called SRIJAN to facilitate indigenisation of the defence manufacturing industry, among others. These efforts have streamlined defence manufacturing and exports.
The establishment of two Defence Industrial Corridors, one each in Uttar Pradesh and Tamil Nadu, has proven instrumental in enhancing India’s capabilities to produce and export more. (Times Kuwait)
