Font size:
Print
India’s Rising Defence Export
Context:
Indian Defence exports touched a record Rs 21,083 crore in the Financial Year (FY) 2023-24, a growth of 32.5% over the last fiscal when the figure was Rs 15,920 crore. The recent figures indicate that the defence exports have grown by 31 times in the last 10 years as compared to FY 2013-14.
About rising India’s Defence export:
- The Ministry of Defence aims to further increase exports to ₹50,000 crore yearly in the next 5 years starting 2028-29.
- The private sector contributed 60% to total exports, while Defense PSUs accounted for 40%.
- Ongoing negotiations aim to expand exports of the BrahMos NG and other systems to countries including South Africa, UAE, and Saudi Arabia.
- Major export destinations include Myanmar (50%), Sri Lanka (25%), Armenia (11%), Mauritius (6.6%), Mozambique (5%), and Seychelles (2.3%)
Government steps:
Earmarking Defense Budget:
-
-
- India plans to allocate 75% of its defence capital budget towards procurements from domestic sources, emphasising self-reliance.
-
Indigenisation Lists:
-
-
- The government has identified 3,738 items for indigenization, imposing an embargo on imports beyond specified timelines.
-
Defense Industrial Corridors:
-
-
- Two defence industrial corridors are being established in Uttar Pradesh and Tamil Nadu to facilitate the growth of the defence manufacturing sector and attract private investment.
-
Private Sector Engagement:
-
-
- In the 2022-23 budget, 25% of the defence research budget was earmarked for the private sector to foster innovation and develop niche technologies.
-
Increase in Export Authorisations
- The number of export authorizations issued to defence exports increased from 1,414 in FY 2022-23 to 1,507 in FY 2023-24.
- Export authorisation in defence is government-issued permission to export defence-related goods, technologies, or services, ensuring compliance with national security regulations and international obligations.
- Export Promotion Councils facilitate collaboration between Indian and foreign companies, streamline export processes, offer financial incentives, and promote Indian defence products internationally.
- The Defence Offset Policy requires foreign companies to invest a percentage of their contract value in Indian businesses, boosting local production and capabilities
- Innovations for Defence Excellence (iDEX) fosters innovation by promoting collaboration between startups, academia, and the defence industry, enhancing India’s global competitiveness in defence technology.
- Till now, procurement worth over Rs 2,300 crore, has been cleared by the MoD for the successful iDEX projects.
- Strategic Partnerships:Agreements with countries like USA, Russia, France, Israel, and Japan for joint development and production of defence equipment.
- INDUS-X (India-US Defence Acceleration Ecosystem) initiative which is strengthening the technology partnership and defence industrial cooperation between the two countries.
- Defence Expo and Aero India: International exhibitions hosted in India to showcase Indian defence capabilities and promote exports.
Challenges:
Quality and Technology Gap:
-
-
- Perception of lower quality compared to Western or Russian equipment
- Lag in cutting-edge technologies in some areas
-
After-Sales Support:
-
-
- Building robust global support and maintenance networks
- Ensuring spare parts availability and timely servicing
-
Geopolitical Considerations:
-
-
- Export decisions often influenced by geopolitical alignments
- Balancing act required between strategic partnerships and export ambitions.
-
