India’s defence exports are on track to surpass the government’s Rs 50,000 crore target before 2029. Speaking at an investor interaction hosted by JM Financial, former DRDO chairman Dr Samir V Kamat said that India’s defence exports currently stand at around Rs 38,000 crore and are expected to grow rapidly in the coming years. “Indigenous system procurement has risen to 70% and imports have fallen to 30%. Over the next five years, indigenous procurement is expected to reach 80-85%,” Kamat said.
Growing global demand helping India
India is likely to exceed the target as international interest in Indian defence products continues to grow. Key export products include the BrahMos missile, Akash missile system, Astra air-to-air missile, Pinaka rocket system, advanced artillery guns and radar systems.
However, he noted that major defence spenders such as the US and China are unlikely to source military equipment from India due to geopolitical considerations.
Europe presents a significant opportunity, although many European countries are also pushing for local manufacturing. This could create larger opportunities for Indian companies supplying subsystems and components rather than complete defence platforms.
India ramps up investment in next-generation defence technologies
Kamat noted that new-age technologies such as drones, artificial intelligence (AI), networked systems and electronic warfare are making significant headway over traditional platforms such as tanks, artillery and aircraft.
To tap this opportunity, India is currently pursuing a major procurement programme for 87 Medium-Altitude Long-Endurance (MALE) drones under the Make category.
Kamat said DRDO is also working on High-Altitude Long-Endurance (HALE) drones, autonomous combat systems and high-altitude airships designed for persistent surveillance.
Higher defence budget to drive next phase of military modernisation
The government’s spending in the defence sector along with growing private-sector participation, are expected to strengthen India’s position both as a defence manufacturer and an exporter over the coming decade.
India’s defence spending could increase to 2% of its GDP over time from the current 1.5%, Kamath noted. Apart from DRDO’s budget, initiatives such as iDEX, the Technology Development Fund and the Anusandhan National Research Foundation are expected to provide additional support to defence innovation.
New opportunities for private defence firms
India’s push to raise indigenous defence procurement to 80-85% over the next few years is also creating fresh opportunities for private-sector players, Kamath noted.
The government and DRDO are working to create a level playing field between private companies and defence public sector undertakings. “Most spaces (except strategic areas) are now open to private competition,” he said, adding that “the DRDO has also created a level playing field with no distinction between public and private for technology sharing.”
Kamat further highlighted that private companies have made significant progress in areas such as radars, missile systems, software-defined radios, high-power microwave technologies and autonomous underwater vehicles.
Conclusion
Despite the Budget allocation hike and the government’s continuous push, Kamat noted that key challenges still persist such as lengthy testing procedures that continue to slow defence procurement. The army requires extensive summer, winter, desert and high-altitude trials before approving equipment. These evaluations can take up to two years. The Air Force also follows a rigorous certification process through the Centre for Military Airworthiness and Certification (CEMILAC), which further extends timelines.