In a major push to strengthen the defence manufacturing ecosystem in India and accelerate self-reliance in military production, the Centre is working on an ambitious plan to establish seven specialised defence manufacturing clusters across the country, according to a report published by BusinessLine. The proposed initiative is aimed at creating region-specific defence hubs that can significantly boost indigenous production, innovation, exports, and reduce India’s dependence on foreign military imports.

This development is being seen as a crucial step under Prime Minister Narendra Modi‘s Aatmanirbhar Bharat vision, with the government looking to transform India from one of the world’s largest arms importers into a major global defence manufacturing hub.

Why is the government setting up these defence clusters?

The Defence Ministry is reportedly holding multiple rounds of consultations to create a new defence manufacturing framework that brings together state governments, private industry, research institutions, startups and academia under a single integrated ecosystem.

The goal is to create specialised manufacturing zones that focus on critical segments of the defence production chain, including testing, certification, research, skill development, exports, industrial infrastructure and indigenisation.

The cluster-based model can help decentralise defence production while improving efficiency, reducing import dependence and strengthening India’s long-term military manufacturing capabilities.

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Seven defence clusters planned across India

Under the proposed structure, each cluster will be led by a designated state, with co-lead states supporting specific manufacturing objectives.

Karnataka-Rajasthan cluster

According to the report, Karnataka is expected to lead the first cluster, with Rajasthan as co-lead. This hub will focus on testing facilities, quality assurance systems and certification standards for defence manufacturing. Academic support is expected from Indian Institute of Technology Kanpur, Indian Institute of Technology Roorkee and Indian Institute of Technology Jammu.

Uttar Pradesh-Jharkhand cluster

This cluster will focus on policy interventions and regulatory reforms aimed at improving India’s defence production ecosystem. Uttar Pradesh will lead, while Jharkhand, Uttarakhand and Jammu & Kashmir are expected to participate.

Maharashtra-Madhya Pradesh cluster

Led jointly by Maharashtra and Madhya Pradesh, this cluster will reportedly focus on indigenisation, private sector participation, startups, innovation and MSME integration. Indian Institute of Technology Bombay is likely to provide technological support.

Punjab-Haryana cluster

Punjab and Haryana are expected to anchor a cluster dedicated to boosting defence exports, improving market access and increasing demand visibility for Indian defence manufacturers.

Gujarat-Odisha cluster

This cluster will focus on workforce training, industrial-academic partnerships and innovation linkages, with leadership from Gujarat and Odisha. Support is expected from Indian Institute of Technology Gandhinagar and Indian Institute of Technology Bhubaneswar.

Tamil Nadu-Andhra Pradesh cluster

In South India, Tamil Nadu and Andhra Pradesh are proposed to lead a cluster focused on building defence industrial infrastructure, integrated production ecosystems and common manufacturing facilities. Indian Institute of Technology Madras is expected to play a major role.

Assam-led Northeast defence cluster

The Northeast is set to get a dedicated defence manufacturing ecosystem led by Assam, with participation from other northeastern states. Indian Institute of Technology Guwahati will likely provide research and technological backing.

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What changes now for India’s defence sector?

The biggest shift will be the creation of specialised regional defence ecosystems instead of a fragmented manufacturing network. It is reportedly said that the cluster model could bring several long-term changes including faster development of indigenous military technology, greater private sector participation in defence manufacturing, higher defence exports to global markets, reduced dependence on imported weapons systems, stronger role for startups and MSMEs in military production and job creation across manufacturing, engineering and technology sectors.

Big push for Aatmanirbhar Bharat in defence

The proposed defence clusters can be seen aligning with the Centre’s strategy of building a self-reliant military manufacturing ecosystem under the Aatmanirbhar Bharat programme. Once operational, these seven hubs are expected to create a nationwide defence production network covering everything from research and design to manufacturing, testing, certification and exports.

In a tweet, Defence Minister Rajnath Singh said the defence sector has witnessed a major transformation due to corporatization. “Driven by enhanced autonomy, innovation, research, and export orientation, defence production has risen from Rs 12,755 crore in FY 2019-20 to Rs 26,282 crore in 2025-26, while defence exports have surged from Rs 81 crore to Rs 4,561 crore,” he said.

The Ministry of Defence was allocated a record ₹7.85 lakh crore (approximately $86 billion USD) for the 2026–27 fiscal year. This represents a 15.19% increase from the previous year’s budget estimate and accounts for roughly 14.67% of the total central government expenditure.