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Why domestic assembly alone is not enough
A platform assembled in India may still rely on imported engines, sensors, materials, software, or components. Domestic production therefore does not automatically mean Indian ownership of the design, control of critical technologies, or the ability to repair and upgrade equipment without external support.
Self-reliance is a chain of capabilities. Procurement must create demand that firms can plan around; that demand must reach domestic manufacturers and their suppliers; research and testing must turn ideas into reliable equipment; and investment and skills must support production at the required quality and scale. Export readiness can then extend the market, but it requires compliance and customer support as well as manufacturing capacity.
- Domestic manufacture: equipment or components are made in India.
- Indigenous design and technology: Indian firms or institutions develop and control important parts of the design and underlying know-how.
- Strategic resilience: the country can produce, maintain, repair, and adapt critical equipment despite disruption to external supply.
These are related goals, not interchangeable measures. A procurement preference or a rise in production is an input or scale indicator; neither by itself proves strategic resilience.
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How the ecosystem is meant to connect
Procurement creates a demand signal
The Government’s Defence Investment Portal describes the Defence Acquisition Procedure 2020 (DAP-2020) as giving priority to the Buy Indian (Indian Designed, Developed and Manufactured, or IDDM) capital-procurement category. A domestic procurement route can give manufacturers a reason to invest in people, equipment, and supplier relationships. It is a preference within procurement policy, not a guarantee that every item bought through a domestic route is wholly indigenous.
For industry, the quality of the demand signal matters as much as its existence. Firms need sufficiently clear requirements and a credible path from development to procurement to justify investment. A challenge-led prototype or a listed item does not itself ensure that the resulting product will be adopted or ordered at scale.
Indigenisation lists identify opportunities and constraints
SRIJAN lists items that the Ministry of Defence is seeking to have manufactured domestically. Positive Indigenisation Lists set future domestic-procurement restrictions for specified components, spares, assemblies, subsystems, and materials. Together, these mechanisms can direct attention and potential orders toward Indian suppliers, including firms further down a platform’s supply chain.
The Ministry of Defence, in figures reported by the Press Information Bureau (PIB) in 2025, said that as of February 2025 more than 38,000 items were listed on SRIJAN and more than 14,000 had been successfully indigenised. The same reporting said that more than 3,000 of over 5,500 items on Positive Indigenisation Lists had been indigenised by that date. These are programme counts; they do not directly measure how much dependence on imports remains, whether all critical inputs are domestic, or how much of the listed production is sustained at scale.
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Innovation programmes can widen access
Defence innovation needs routes for smaller firms and research teams to address military problems, develop prototypes, and seek a transition into procurement. The Ministry’s Innovations for Defence Excellence (iDEX) programme engages startups, micro, small and medium enterprises (MSMEs), individual innovators, research institutions, and academia.
In a February 2025 account, the Ministry/PIB reported 549 iDEX problem statements, 619 startups and MSMEs involved, and 430 contracts signed. It also reported that 43 items worth over ₹2,400 crore had been cleared for procurement from iDEX startups and MSMEs. These are reported programme activity and clearance figures, not independent measures of fielding, operational performance, or repeat orders.
Manufacturing depth depends on more than large firms
A defence industrial base includes public-sector defence enterprises (DPSUs), licensed companies, private firms, and smaller suppliers. Large contractors may integrate complex systems, while specialised suppliers make parts and subsystems; research organisations and universities can contribute knowledge and talent. If any link is missing—such as testing capacity, qualified suppliers, skilled workers, or reliable access to components—a domestic prime contractor may still depend on external sources or struggle to expand production.
India’s official policy toolkit includes industrial corridors and liberalised foreign direct investment (FDI) rules as means of supporting industrial capacity and investment. The Government’s Defence Investment Portal states that up to 74% FDI is permitted through the automatic route, with investment above that level through the government route. The applicable rules can change, so investors should consult current official guidance before relying on that threshold for a transaction.
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Corridors can cluster firms, but a cluster is not proof of a complete supply chain
India’s two established Defence Industrial Corridors are in Uttar Pradesh and Tamil Nadu. A Ministry of Defence/PIB explainer published in 2025 reported more than ₹8,658 crore invested across the corridors’ eleven nodes. That is the source’s reported figure and timeframe, not a verified 2026 total.
Clusters can bring manufacturers, infrastructure, and suppliers closer together. But investment totals and node counts do not establish whether a corridor has developed specialised suppliers, testing facilities, a skilled workforce, or repeat orders. Those capabilities are what determine whether geographic concentration translates into supply-chain depth.
What production and exports show—and what they do not
The Ministry of Defence/PIB reported defence production of ₹1,27,434 crore in FY 2023–24, compared with ₹46,429 crore in FY 2014–15. These figures indicate a substantial increase in reported production value over that period. They do not, by themselves, show which technologies are domestically controlled, the import content of output, or how much production can be sustained during a supply disruption.
Separately, the Ministry/PIB reported defence exports of ₹23,622 crore in FY 2024–25. It attributed ₹15,233 crore of those exports to the private sector and ₹8,389 crore to DPSUs. These are export figures for a different fiscal year from the FY 2023–24 production total and should not be treated as directly comparable measures.
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Exports can help firms build production scale and serve customers beyond domestic procurement. Yet export value is not a complete measure of competitiveness: it does not establish the durability of demand across markets and product lines, the level of after-sales support, or whether exports depend on imported critical inputs.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Export capability includes authorisation and compliance
Producing an item is not the same as being able to export it. The Department of Defence Production’s export portal describes an authorisation framework for arms and ammunition under SCOMET Category 6, specified firearm parts under the Arms Act, and Open General Export Licences for specified goods and destinations. The applicable route depends on the item and destination; exporters need to establish the relevant requirements rather than assume that a domestic product can be shipped freely.
This is one reason an ecosystem matters: firms need not only engineering and production capacity but also the ability to meet export controls, certifications, customer requirements, and support obligations. The portal describes authorisation routes; it does not by itself establish the breadth of India’s export competitiveness.
How to assess whether the ecosystem is delivering
Official policy provisions and programme totals describe mechanisms and activity. Assessing strategic outcomes requires evidence beyond those counts. A useful evaluation separates what is being put in place from what the country can demonstrably do:
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|---|---|---|
| Is there a domestic procurement route? | DAP-2020 includes a priority for Buy Indian (IDDM) capital procurement. | That every domestically procured system is fully indigenous or has no critical imported inputs. |
| Are items being targeted for indigenisation? | SRIJAN and Positive Indigenisation Lists identify items and report dated progress counts. | The remaining level of import dependence, the criticality of items, or their production at scale. |
| Are production and exports growing? | The Ministry/PIB reports production and export values for specified fiscal years. | Technology ownership, resilience to external disruption, or durable competitiveness across markets. |
| Are firms and innovators being engaged? | iDEX figures report problem statements, participating firms, contracts, and items cleared for procurement. | Independent evidence of operational fielding, performance, or repeat procurement. |
| Are industrial clusters attracting investment? | A 2025 Ministry/PIB explainer reported investment across the Uttar Pradesh and Tamil Nadu corridor nodes. | Whether investment has produced deep supplier networks, testing capacity, or lasting industrial spillovers. |
The key outcome questions are whether Indian firms control more critical designs and technologies, whether domestic suppliers can reliably provide important inputs, whether systems can be maintained and upgraded locally, and whether new products move from prototype into repeat service orders. The official figures cited here do not independently answer those questions or isolate the effect of any one policy.
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