India is set to emerge as one of the primary players in the global defense export market, catalyzed by rising geopolitical tensions and an expanding need for aerospace and defense technologies. India’s defense exports have grown exponentially from Rs. 686 crore during FY 2013-14 to almost Rs. 16,000 crore during FY 2022-23, setting India among the top 25 defense exporters of the world.
Key Drivers of India’s Defense Export Growth
Geopolitical Risks: Dependence on external suppliers leaves the country vulnerable, providing a gap-filling opportunity for India.
External Opportunities: Reduction in Chinese arms exports creates opportunities for India to increase market share.
Domestic Strengths and Initiatives: India’s ability to support Russian military platforms, its excellence in software and AI, and the increasing strategic significance of the Indo-Pacific.
Government Support and Policy:
Innovation for Defence Excellence (IDEX): Developing hundreds of startups to pursue innovation.
Defence Production & Export Promotion Policy (DPEPP): Facilitating R&D and indigenization of defense industry.
Positive Indigenization List: Having 411 key weapon platforms and systems and import embargo.
Defense Exports Steering Committee: Oversees and promotes defense product exports.
Advantages of Defence Exports:
Economic Benefits: Earns foreign exchange and replaces defense product imports.
Strategic Interdependence: Generates dependencies for maintenance, repair, and future upgrades.
Increased Military Cooperation: Promotes compatibility and enables joint operations.
Geopolitical Clout and Diplomatic Influence: Strengthens India’s strategic and diplomatic standing.
Challenges and Way Forward:
Bureaucratic Resistance: Inefficient practices inhibit private sector integration and innovation.
Delays in Defence Projects: Cost overruns and project delays inhibit growth.
Inadequate Funding for R&D: Unattractive investment and infrastructure shortages.
Simplifying Rules: For government-to-government sales and international transactions.
Innovation and Technology Licensing: Safeguarding national interests and encouraging startups.
By overcoming these challenges and capitalizing on its strengths, India can enhance its defense sector and become a major player in the global defense export market, eyeing nations such as Russia and increasing cheap loans for arms exports to poor countries ¹.