New Delhi [India], April 17 : India's defence sector is set to grow steadily, supported by strong efforts towards indigenisation, a solid order pipeline, and rising growth opportunities, according to a recent report by Nirmal Bang.
The report maintains a positive outlook on the sector, citing the government's focused approach to boost domestic defence production and reduce dependency on imports.
It said, "We maintain a positive outlook on the defence sector, highlighting the ongoing efforts towards indigenisation, a strong order pipeline, and significant growth potential."
The report highlighted that India's annual defence production has already crossed Rs 1.27 trillion and is likely to touch Rs 1.75 trillion by the end of FY25.
Looking ahead, the country aims to reach Rs 3 trillion in defence output by 2029. This ambitious target would further strengthen India's position as a major global hub for defence manufacturing.
In a record-breaking development, the Ministry of Defence signed 193 contracts in 2024-25, with a total value exceeding Rs 2.1 trillion. This is the highest-ever figure and is nearly double the previous record.
Out of these, 177 contracts making up 92 per cent of the total were awarded to the domestic defence industry. These domestic contracts are valued at around Rs 1.6 trillion, accounting for 81 per cent of the total contract value. This clearly shows the government's strong push towards encouraging home-grown defence manufacturing.
The report also noted that the Defence Acquisition Council (DAC) approved eight capital acquisition proposals worth about Rs 540 billion in FY25. These approvals are part of the broader plan to upgrade and modernise the armed forces.
Among the key projects, the Army will acquire a 1,350-horsepower engine to replace the existing 1,000-horsepower engine used in its T-90 tanks, to improve performance and efficiency. For the Navy, the DAC has approved the purchase of Varunastra Torpedoes a major step forward in naval technology.
These anti-submarine torpedoes, developed indigenously by the Naval Science & Technological Laboratory, are designed to be launched from ships and strengthen underwater defence capabilities.
Looking ahead, the report expects that the Ministry of Defence will continue focusing on enhancing the capabilities of the Indian Air Force (IAF) fleet. With consistent efforts in indigenisation, strategic acquisitions, and rising production capacity, India's defence sector is well on track for robust growth in the coming years.
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