How ‘Make in India’ and Defence Policies Are Powering India's Self-Reliant Defence Sector

This article is authored by Siddhartha Abburi, Director, Avantel Limited

India’s defence exports have recorded an impressive growth, an increase of 12.04 per cent over last year’s Rs 21,083 crore. This is yet another strong sign that the country’s defence sector is rapidly transforming. What was once heavily reliant on imports is now evolving into a hub of self-reliance and homegrown innovation. Two powerful drivers behind this shift are the government’s ambitious ‘Make in India’ campaign and a sharp focus on building wartime readiness. Together, they are reshaping how India protects its borders, by boosting domestic manufacturing, fostering technological innovation, and enhancing strategic autonomy.

A Strategic Shift in India’s Defence Sector
India is decisively moving toward self-reliance, rapid modernisation, and increased preparedness. Geopolitical tensions—from the Russia-Ukraine conflict to ongoing border challenges—have underscored the urgency of building a future-ready defence ecosystem.
This urgency is clearly visible in budgetary priorities. For FY25-26, India’s Ministry of Defence has been allocated a record Rs 6.81 lakh crore, up 9.53 per cent from the previous year, with Rs 1.8 lakh crore dedicated to capital outlay. Notably, 75 per cent of the modernisation budget is earmarked for procurement from domestic sources, including a significant share reserved for private industry participation. The message is clear that India is no longer just buying defence capabilities but is committed to building them at home.

‘Make in India’ – A Reform Engine
The government’s flagship initiative – ‘Make in India’ has stimulated the defence sector. Procurement policies have been passed to promote local sourcing, and new-age companies are being actively encouraged to develop advanced capabilities across domains like aerospace, naval systems, electronics, and satellite communications.
Under the Defence Acquisition Procedure (DAP) 2020, procurement rules have been simplified, boosting the confidence of private players and MSMEs. Dedicated Defence Industrial Corridors are creating clusters of innovation and manufacturing excellence.
Public sector undertakings are also being pushed to increase vendor diversity by partnering with indigenous suppliers. The result is a broad-based defence ecosystem that is robust, alert, and increasingly competitive.

A New Era of Warfare – From Guns to Gigabytes
Warfare today is driven by technology, not just firepower. Key enablers like AI, quantum computing, cyber warfare, and immersive tech are transforming how battles are fought and won. AI powers autonomous systems and real-time decision-making, while quantum tech redefines secure communication. With rising cyber threats, cybersecurity has become as critical as physical defence.
Edge computing is emerging as a game-changer, enabling on-ground data processing and faster responses in high-stakes environments. Paired with SATCOM, it ensures secure, real-time connectivity for command and communication across terrains. Together, these technologies are reshaping India's defence preparedness.

Private Sector Leading Homegrown Innovation
India’s defence narrative is no longer driven solely by public sector giants. A new wave of private enterprises, ranging from tech startups to mid-sized defence tech firms, is leading the charge in developing indigenous solutions.
From AI-driven surveillance systems and tactical gear to advanced payloads and secure communication devices, Indian firms are building full-spectrum capabilities across air, land, sea, and space. The iDEX (Innovations for Defence Excellence) initiative is playing a critical role in this transformation, offering grants, mentorship, and testing support for disruptive technologies.
This innovation-led model has not only enhanced India’s defence preparedness but also exposed significant export opportunities.

Dual-Use Technologies and Societal Spillover
A major strength of India’s new defence approach is the dual-use potential of many of its technologies. SATCOM systems, originally built for battlefield connectivity, now support emergency response, disaster relief, and rural internet access. Similarly, UAVs used for reconnaissance are being repurposed for agriculture, infrastructure monitoring, and wildlife protection.
This cross-pollination between military and civilian domains enhances return on investment, creates new markets, and ensures that taxpayer-funded innovation delivers value far beyond defence.

Policy Tailwinds and Global Confidence
As of March 2024, India had achieved over Rs 21,000 crore in exports, with the weakened rupee raising the USD 5 billion target to over Rs 43,000 crore. The Defence Production and Export Promotion Policy (DPEPP) 2020 was introduced to propel India’s defence exports to Rs 35,000 crore (USD 5 billion at the time) by 2025.
Key reforms like liberalising the space sector, raising the FDI cap to 74 per cent via the automatic route, and improving transparency have boosted investor confidence. Supported by strong budget allocations and strategic partnerships, these policies are driving India’s emergence as a competitive and reliable global defence exporter.

Outlook – A Secure, Self-Reliant Future
India's defence sector is undergoing a paradigm shift from being import-dependent to becoming a net exporter of high-value defence technology. At the intersection of national security, economic growth, and technological innovation lies a powerful investment story. For industry players and investors alike, the momentum is obvious. Guided by the vision of ‘Viksit Bharat,’ our country’s defence journey is steadily advancing towards a future of strength and self-reliance.

Disclaimer: The opinions expressed above are of the author and may not reflect the views of DSIJ