India accelerates defence manufacturing through private sector growth

defence manufacturing aerospace startups indigenous technology defence exports private sector innovation

India is undergoing a significant transformation in its defence industrial ecosystem, shifting from public-sector dominance toward a competitive, innovation-led market. The Defence Acquisition Council recently approved ₹1,10,000 crore in capital acquisitions, with 98% of these being sourced domestically.

Defence production has seen substantial growth, rising from ₹43,746 crore in FY14 to approximately ₹1,78,000 crore in FY26. Additionally, defence exports increased by over 62% in a single year to reach ₹38,424 crore, serving more than 80 countries. Private enterprises now contribute roughly ₹42,000 crore to the nation's defence production.

Key private players including Larsen & Toubro, Bharat Forge, and TATA Advanced Systems are leading developments in missile systems, naval platforms, and artillery. The Innovations for Defence Excellence (iDEX) initiative has further supported this shift by engaging 676 innovators and signing 551 contracts since 2018, focusing on advanced technologies such as UAVs, robotics, and artificial intelligence-assisted targeting.