India's defence production hits record ₹1.27 lakh crore; exports surge 32%

India recorded the highest-ever growth in indigenous defence production and exports in 2023-24. The value of domestic defence production went up to ₹1,26,887 crore in 2023-24 with a growth of 16.7% over the defence production of the previous financial year. The value of defence production in FY2022-23 was ₹1,08,684 crore.

Of the total production value in 2023-24, about 79.2% has been contributed by defence public sector units (DPSUs) and other PSUs and 20.8% by the private sector. Defence exports touched a record ₹21,083 crore (US$ 2.63 billion) in the FY2023-24, a growth of 32.5% over the previous fiscal when the figure was ₹15,920 crore, says data released by the Ministry of Defence, which has set a target of Rs three lakh crore defence production and ₹50,000 crore exports by 2029.

Defence exports grew 31 times in the last 10 years compared to FY 2013-14. The private sector and DPSUs contributed about 60% and 40%, respectively.

To boost "Aatmanirbharta" in defence and minimise imports by DPSUs, the Department of Defence Production in July, notified its fifth Positive Indigenisation List (PIL) consisting of 346 items. Earlier, four PILs comprising 4,666 items were notified by the DDP for DPSUs, of which 2,972 items, having import substitution value worth ₹3,400 crore, have already been indigenised. These five lists for DPSUs are in addition to the five PILs of 509 items notified by the Department of Military Affairs. These lists include highly complex systems, sensors, weapons and ammunition.

In the Union Budget of FY 2024-25, MoD was allocated ₹6.22 lakh crore (approx. US $75 Billion), the highest among the ministries and ₹1 lakh crore (18.43%) over the allocation for FY 2022-23 and 4.79% more than the allocation of FY 2023-24. Out of this, a share of 27.66% goes to capital acquisition. About 75% of the defence capital procurement budget has been earmarked for domestic industry, said the MoD.