India's Defence Production Surpasses ₹1.46 Trillion in FY25 with Significant Private Sector Involvement
Record Growth in Defence Production
In the fiscal year 2024-25, India's defence production achieved a remarkable milestone, exceeding its previous record by nearly 15%, totaling ₹1.46 trillion, as announced by Defence Minister Rajnath Singh. He highlighted that defence exports rose to over ₹24,000 crore, marking an increase of approximately 14% compared to the previous fiscal year.
During his address at the Confederation of Indian Industry's annual summit in New Delhi, Singh emphasized the crucial role of the private sector, which contributed over ₹32,000 crore, accounting for 22% of the total defence production. He noted that for the first time, private firms will collaborate with public sector entities on a significant defence initiative under the AMCA programme, which received approval recently.
The AMCA project aims to develop five prototypes that will be mass-produced, representing a significant step forward in the Make-in-India initiative. Singh expressed pride in India's status as the fourth-largest economy and underscored the defence sector's contribution to this progress.
Reflecting on the past decade, Singh noted that defence production was merely ₹43,000 crore, while the current Defence Budget exceeds ₹1.46 trillion, bolstered by substantial private sector investment. He pointed out that defence exports have surged from ₹600-700 crore to over ₹24,000 crore.
Currently, around 100 nations utilize India's weapons, systems, and services. Singh attributed the success of India's operations against terrorist targets in Pakistan and PoK to the Make-in-India initiative, emphasizing the importance of indigenous defence capabilities.
Defence Secretary Rajesh Kumar Singh assured private sector representatives that the government would extend the same support to them as it has to public sector firms. He expressed a commitment to simplifying business processes and providing equal opportunities.
Singh explained that the armed forces previously faced delays in large procurements, which created gaps in capabilities and underutilized defence budgets. However, he noted that the modernisation budget for the last financial year was fully utilized for the first time in five years.
A key highlight was the signing of contracts worth ₹2 trillion, doubling the previous year's record of ₹1 trillion. The secretary expressed optimism that this rapid development would enhance military modernisation, enabling the Ministry of Finance to seek additional funding for upgrading the armed forces.
He stated, "With our GDP growing at a compound rate of $4 trillion, 1.9% allocated for defence spending will ensure we have the necessary resources for upgrades, provided the Ministry and industry are equipped to meet these demands." The event was attended by notable figures, including Chief of the Naval Staff Admiral Dinesh K Tripathi and Chief of the Air Staff Air Chief Marshal AP Singh.