India’s defence production reached a record $19 billion in FY26, driven by policy reforms, increased private-sector involvement, enhanced research and development, higher domestic procurement, and a focus on indigenous manufacturing, as per a report from Vietnam Times.
Over the past five years, defence output in India has more than doubled, surging from around $8.5 billion in FY21 to the current level. This growth is attributed to various government initiatives such as positive indigenisation lists, streamlined procurement processes, elevated domestic procurement goals, and enhanced backing for indigenous research and development.
The report highlights India’s transition from reliance on foreign suppliers to an expanding manufacturing ecosystem that is gaining significance globally. While Defence Public Sector Undertakings continue to play a central role in production, there is a noticeable increase in the involvement of the private sector.
Notably, the defence sector has seen a rise in participation from established industrial groups, specialized defence manufacturers, technology companies, and a burgeoning network of startups that are now producing advanced systems previously imported or exclusively made by state-owned entities.
Indigenous manufacturing in India now encompasses a wide array of platforms and technologies, including artillery systems, armoured vehicles, naval platforms, missile systems, electronic warfare equipment, radar technologies, aerospace components, and advanced communications.
India’s defence exports have surged in recent years, largely due to government efforts to expand outreach. The report underscores that the growing global acceptance of Indian defence products signifies confidence in the country’s capabilities and competitiveness.
Various defence products like patrol vessels, radar systems, artillery equipment, protective gear, aerospace components, and defence technologies are now being exported to regions across Asia, Africa, Europe, and Latin America.
Defence Public Sector Undertakings and other PSUs accounted for approximately 76% of total production, with the private sector contributing 24%, marking an increase from 22% in FY25. The private sector’s share has reached an all-time high of around Rs 42,000 crore in FY26, underscoring its expanding role in the defence ecosystem.
