New Delhi, August 15: Over the past decade, extensive reforms in the defense sector have positioned India as a strong, self-reliant, and globally trusted power in military equipment production and exports. According to a fact sheet released by the government on the eve of Independence Day, the country’s defense production reached a record ₹1.78 lakh crore in 2025-26, a significant increase from just ₹4,746 crore in 2013-14.
In 2025-26, public sector units contributed 76% to defense production, while the private sector accounted for 24%.
India’s defense exports have also seen remarkable growth. Exports surged from ₹686 crore in 2013-14 to ₹38,424 crore in 2025-26. Indian military equipment is now being sold in over 80 countries.
In the total defense exports for 2025-26, the private sector contributed ₹17,353 crore, or 45.16%, while public sector enterprises contributed ₹21,071 crore, or 54.84%.
The central government has set an ambitious target of achieving an annual defense production of ₹3 lakh crore and defense exports of ₹50,000 crore by 2029.
Funding for research and development in the defense sector has also increased significantly. The allocation rose from ₹13,716.14 crore in 2014-15 to ₹29,100.25 crore in 2026-27, marking an increase of over 112%.
Starting from 2022-23, 25% of the defense R&D budget is now open to industry, startups, and academic institutions to promote innovation and modernize defense production.
The Defense Research and Development Organization (DRDO) has made testing facilities available to the industry through the Defense Testing Portal (DTP). This digital platform, managed by the Ministry of Defense, allows domestic manufacturers, startups, and industries to apply for paid access to government testing facilities.
India’s top defense procurement body, the Defense Acquisition Council (DAC), is also promoting ‘Atmanirbhar Bharat’ (self-reliant India) through indigenous purchases. The council has approved Acceptance of Necessity (AoN) for defense systems designed by DRDO and manufactured by Indian industries, amounting to over ₹6 lakh crore.
Under indigenous procurement, the purchase of 97 Tejas MK-1A fighter jets for approximately ₹62,000 crore and 156 LCH ‘Prachand’ helicopters for around ₹62,700 crore has been approved. These projects are strengthening the country’s domestic aerospace and defense manufacturing capabilities.
The Defense Acquisition Procedure (DAP) 2020 has reinforced indigenous procurement and domestic manufacturing, while also expanding opportunities for Indian companies in design, development, and production within the defense sector.
Previously, the Defense Procurement Procedure (DPP) 2016 simplified the defense procurement system and promoted ‘Make in India,’ laying the groundwork for subsequent reforms in defense procurement.
According to the government, the Defense Procurement Manual (DPM) 2025 has streamlined the revenue procurement process worth approximately ₹1 lakh crore. It has expedited approvals, provided relief in penalty provisions for indigenous projects, and assured long-term orders.
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