Defence Manufacturing in India : Goal for Self Reliance

Defence manufacturing is a key segment which has been earmarked for development and manufacturing growth in India. The sector provides immense possibilities for creating upstream and downstream investment prospects besides promoting innovation and growth.

India needs a strong self-defence mechanism to sustain itself from external threats. The country needs to align its defence manufacturing with the best in the world and produce modern weapons and ammunitions. This would put the country on a different pedestal. The public and private sector need to work coherently and create an ecosystem that would foster this. As government brings forth policies to enhance domestic manufacturing, private sector needs to supplement it by investing in technology and innovations. This will significantly contribute to making our defence sector a robust one.

It is encouraging to note that there have been some positive developments in both public and private sectors. Some of these being :

• Government of India has created a technology innovation fund (with contributions from Hindustan Aeronautics Limited and Bharat Electronics Limited) for encouraging start-ups.
• Private companies such as TATA Advanced Systems, Reliance Industries, L&T, and Mahindra have entered into agreements for defence manufacturing.
• Defence Production Policy 2018 which sets ambitious goals for development and creation of a viable defence production ecosystem for solidifying the several initiatives of the government and enhancing the defence design and production capabilities.

Although India is still at a nascent stage in defence manufacturing there are encouraging signs with the government opening up the sector to 100% FDI and many private players evincing interest in defence production. Indian machine tool industry needs to make the most of this opportunity by investing in R&D, developing high precision technologies and critical components and creating a robust supply chain.

This will pave way for various MSMEs dotting India’s manufacturing landscape with significant opportunities in defence manufacturing in the long-term. It will also help India realize ‘Vision 2025’ which eyes place for India among the world’s top 5 defence producers.