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Could Trump-Era U.S. Defense Deals Undermine Modi’s Make in India?

Direct U.S. defense purchases may provide capability without building Indian manufacturing capacity. Announced co-production plans could change that, but their industrial impact depends on contract terms and implementation.
From TheFinanceBase Team4 min to read
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They could—if India buys finished U.S. weapons without gaining meaningful production work, technology, or sustainment capability at home. But that is a risk, not an established outcome: U.S.–India defense policy also includes announced co-production, joint-development, and maintenance initiatives. The key question is what each agreement actually gives Indian industry, not whether a deal is labeled a partnership.

Why direct purchases can conflict with Make in India

Satya Narayan Misra’s January 21, 2025 opinion article argues that direct arms purchases can meet India’s strategic or operational needs while missing opportunities to build domestic manufacturing capability. His concern is that buying a finished system may leave less room for technology transfer, local production, and competitive price discovery than an agreement structured to develop Indian capacity. That is his analysis, not proof that every import has the same industrial effect. Read Misra’s argument at Scroll.in.

The distinction is between three broad routes:

  • Buy: import a finished system. India may gain an operational capability, but the purchase alone does not establish domestic manufacturing or access to design know-how.
  • Make: develop and produce a system domestically, building local design and production capability.
  • Buy and make: acquire technology or equipment while also producing domestically, potentially developing skills and industrial capacity if the agreement provides for meaningful work and knowledge-sharing.

Misra uses India’s procurement history—including a fighter procurement he describes as shifting from a buy-and-make tender to a direct Rafale purchase—to illustrate this tension. Those examples belong to his argument; the available sources do not independently verify every contract detail or establish the industrial results of each deal.

What U.S.–India policy says now

The picture is not limited to direct sales. In an October 31, 2025 fact sheet on the updated ten-year U.S.–India Major Defense Partnership framework, the U.S. Department of Defense said the framework “envisions joint development and production of defense capabilities.” It identifies focus areas including intelligence, surveillance and reconnaissance; undersea domain awareness; air combat and support; air and space domain awareness; munitions; and mobility. It also describes an ambition to develop India as a regional logistics, maintenance, repair, and overhaul (MRO) hub. These are stated priorities, not evidence that every initiative has been contracted or delivered. U.S. Department of Defense framework fact sheet.

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Examples of announced industrial cooperation

GE Aerospace and HAL: F414 engines

A November 2023 U.S.–India 2+2 joint statement said negotiations had begun between GE Aerospace and Hindustan Aeronautics Limited (HAL) for manufacture of GE F414 engines in India, describing the partnership as an example of intended industrial cooperation. The statement records negotiations and intent; it does not establish final production output, the extent of technology transfer, or the initiative’s economic effect. U.S.–India 2+2 joint statement.

General Atomics and Indian partners: MQ-9B-related work

A March 2024 U.S. Department of Defense INDUS-X fact sheet described General Atomics partnerships with Indian companies connected to the future MQ-9B program. It named software and artificial-intelligence work with 114ai, and component and assembly manufacturing with Bharat Forge. The fact sheet establishes announced cooperation, not the eventual scale of production or the degree of technology access. U.S. Department of Defense INDUS-X fact sheet.

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Why a co-production announcement is not the same as technology access

India’s and the United States’ 2023 industrial cooperation roadmap identifies areas such as intelligence, surveillance and reconnaissance; undersea awareness; air combat and support, including aero engines; munitions; and mobility. It also makes clear that co-developed or co-produced sales and transfers remain subject to both countries’ export-control laws and other considerations. A framework or partnership therefore does not imply unrestricted access to sensitive technology. U.S.–India Defense Industrial Cooperation Roadmap.

Nor does the word “co-production” by itself answer how much work happens in India, whether Indian firms gain design or manufacturing know-how, or what rights they have to maintain and upgrade the system. The cited public statements do not provide contract-level measures of technology transferred, local value added, intellectual-property rights, or long-term industrial effects.

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How to judge whether a deal advances Make in India

For any particular agreement, look beyond its headline and examine what the contract permits and requires:

  • Production model: Is India importing a finished system, assembling imported kits, manufacturing components, or producing under a licensed or co-production arrangement?
  • Indian workshare: What work is actually performed in India, and which Indian suppliers participate?
  • Knowledge and rights: What manufacturing know-how, design information, software access, and intellectual-property rights are included?
  • Long-term support: Can Indian organizations maintain, repair, upgrade, and sustain the system domestically?
  • Legal and contractual limits: What export controls and other conditions restrict technology transfers, sales, or future use?

The public policy statements cited here do not answer those questions for every deal. Without the relevant contract terms and implementation evidence, it is not possible to score individual purchases or partnerships on their actual contribution to Indian industrial capacity.

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The answer: a real tension, not a proven outcome

Misra’s warning identifies a genuine trade-off: a direct import can provide military capability without necessarily creating the domestic industrial gains that a well-structured production agreement might. But the later official record also describes co-development, co-production, and MRO ambitions, alongside announced initiatives involving GE Aerospace and HAL and General Atomics and Indian partners. Whether those efforts meaningfully advance Make in India will depend on what is implemented—and on the production scope, access, rights, and work retained in India—not on the language of a framework alone.

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