Defence Decade Transformation

Context

In 2026, the Press Information Bureau (PIB) released a comprehensive backgrounder titled "The Defence Decade: Enhanced Capability, Greater Capacity, and Stronger Credibility", highlighting India's defence transformation between 2014 and 2026.

About the News

Background

Over the past twelve years, India has undergone a strategic transformation from being one of the world's largest importers of defence equipment to becoming a major indigenous defence manufacturing hub. Guided by the visions of Atmanirbhar Bharat and Make in India, the Ministry of Defence has introduced transparent, innovation-driven, and industry-friendly reforms to strengthen domestic defence production.

Key Data and Statistics

• Defence Budget: Increased from 2.53 lakh crore in FY 2013–14 to a record 7.85 lakh crore in FY 2026–27.
• Capital Expenditure: Rose from 94,588 crore in 2014–15 to 2.19 lakh crore in 2026–27.
• R&D Expenditure: Increased by over 112%, from 13,716 crore in FY 2014–15 to 29,100 crore in FY 2026–27.
• Defence Production: Indigenous defence production increased from 46,429 crore in 2014–15 to 1.78 lakh crore in 2025–26.
• Private Sector Participation: Defence Public Sector Undertakings (DPSUs) accounted for 76% of production, while the private sector contributed 24%.
• Industrial Licences: Active defence manufacturing licences increased from 258 in 2015 to 834 by March 2026.
• Foreign Direct Investment (FDI): India received 6,671 crore in FDI in the defence sector by March 2026 after allowing 74% FDI through the automatic route and 100% through the government route.
• Defence Exports: Defence exports rose dramatically from 686 crore in FY 2013–14 to 38,424 crore in FY 2025–26.
• Import Dependence: India has reduced import dependence from nearly 65–70% to manufacturing around 65% of its defence equipment domestically.

Governance Reforms and Structural Transformation

• Corporatisation of the Ordnance Factory Board (OFB): In October 2021, the government replaced the 200-year-old OFB with seven Defence Public Sector Undertakings (DPSUs) by restructuring its 41 ordnance factories.
• Innovations for Defence Excellence (iDEX): The iDEX initiative promoted innovation by MSMEs and start-ups, signing 551 defence innovation contracts by March 2026.
• Positive Indigenisation Lists (PILs): The Ministry of Defence notified five Positive Indigenisation Lists, restricting imports of 5,012 defence items and generating domestic procurement orders worth 9,782 crore through the Srijan Portal.
• Defence Industrial Corridors: Investment commitments reached 42,057 crore in Uttar Pradesh and 32,699 crore in Tamil Nadu by April 2026.
• Srijan DEEP Platform: The Defence Establishments and Entrepreneurs Platform (DEEP) created a database of over 41,000 verified defence suppliers, strengthening the domestic supply chain.

Major Technological Milestones

• Mission Shakti (2019): India successfully demonstrated Anti-Satellite (ASAT) capability by destroying a satellite in Low Earth Orbit.
• Mission Divyastra (2024): Successfully tested a strategic missile equipped with Multiple Independently Targetable Re-entry Vehicles (MIRV) technology.
• Hypersonic Technology (2026): Successfully completed a 12-minute ground test of an actively cooled scramjet combustor and established a new Hypersonic Wind Tunnel in Hyderabad.
• Major Defence Procurement: The Defence Acquisition Council approved Acceptances of Necessity (AoN) worth over 6 lakh crore, including:
  • 97 Tejas Mk-1A fighter aircraft worth 62,000 crore.
  • 156 Prachand Light Combat Helicopters worth 62,700 crore.
• Project 75: India completed the delivery of all six Kalvari-class Scorpene submarines in 2025, built by Mazagon Dock Shipbuilders Limited in collaboration with France.

Challenges

• Technology Commercialisation: Converting DRDO-developed technologies into large-scale commercial production remains a significant challenge.
• Technology Transfer: Ensuring technology partnerships with foreign manufacturers do not compromise strategic autonomy or intellectual property rights.
• Skilled Workforce: Expanding indigenous defence manufacturing requires continuous upskilling of engineers and technicians.
• State-Level Clearances: Land acquisition, environmental approvals, and local administrative clearances continue to delay some defence manufacturing projects.

Way Forward

• Strengthen Indigenous Procurement

Implement the Defence Acquisition Procedure (DAP) 2026 with a mandatory minimum 60% indigenous content requirement for capital acquisitions.

• Promote Advanced Defence Technologies

Utilise the 500 crore Technology Development Fund (TDF) to accelerate research in emerging technologies such as Artificial Intelligence (AI), Quantum Computing, autonomous systems, and drone swarms.

• Expand Defence Exports

Continue strengthening India's global defence partnerships to achieve the target of 50,000 crore in annual defence exports by 2029.

• Strengthen Strategic Partnerships

Leverage initiatives such as the India–US TRUST Initiative and the MAHASAGAR Doctrine to establish India as a leading security provider in the Indo-Pacific region.

Conclusion

India's transformation from a major defence importer to a rapidly expanding indigenous defence manufacturing nation represents one of the country's most significant strategic achievements. Increased defence spending, structural reforms, technological innovation, and stronger private sector participation have substantially enhanced India's defence capabilities while advancing the goals of self-reliance, strategic autonomy, and global competitiveness.