India’s defence modernisation efforts have accelerated in recent years amid evolving security challenges along its borders and the broader Indo-Pacific region. From large-scale procurement of indigenous platforms to reforms in defence acquisition procedures, the push toward self-reliance has gained strategic and economic significance. The emphasis on indigenous manufacturing under the Atmanirbhar Bharat initiative reflects a paradigm shift in India’s defence policy—from being one of the world’s largest arms importers to aspiring to become a major defence exporter.
Recent developments such as increased defence exports, induction of advanced missile systems, naval shipbuilding expansion, and production-linked incentives for defence manufacturing have kept the sector in the news. The policy direction is shaped by strategic assessments, particularly after border tensions with China and the need for technological superiority.
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Institutions such as the Ministry of Defence, Defence Research and Development Organisation, and public sector undertakings like Hindustan Aeronautics Limited play a pivotal role in this transformation. The reforms also involve the corporatisation of the Ordnance Factory Board and greater participation of private industry.
Defence modernisation is not merely about weapons acquisition; it is about strengthening deterrence, enhancing technological capability, and fostering strategic autonomy. For UPSC aspirants, the issue intersects with national security, defence technology, economic policy, and foreign relations.
Table of Contents
Historical Dependence and the Need for Reform
Historically, India relied heavily on imports for major defence platforms. According to global arms trade data, India has been among the top arms importers for decades. Dependence on foreign suppliers creates vulnerabilities, including supply disruptions, technology denial regimes, and strategic constraints.
The 1999 Kargil conflict highlighted gaps in equipment and surveillance systems. Subsequent reforms aimed to streamline procurement and promote indigenisation. However, bureaucratic delays and limited private participation slowed progress.
The Atmanirbhar Bharat initiative revitalised defence indigenisation by introducing negative import lists, encouraging domestic production, and simplifying procurement norms. These reforms reflect recognition that national security cannot be divorced from industrial capability.
Five Important Key Points:
- India has introduced “negative import lists” banning certain defence imports.
- Defence exports have increased significantly in recent years.
- The Ordnance Factory Board was corporatised to improve efficiency.
- Private sector participation in defence production has expanded.
- Indigenous platforms such as the Tejas fighter aircraft are being inducted.
These steps indicate a structural shift in India’s defence industrial policy.
Constitutional and Legal Framework
While defence is a Union subject under the Seventh Schedule of the Constitution (List I), parliamentary oversight remains essential. Article 246 empowers Parliament to legislate on defence matters. Budgetary allocations for defence are approved annually by Parliament, reflecting democratic accountability.
Procurement procedures are governed by the Defence Acquisition Procedure (DAP), which emphasises transparency, indigenous content, and technology transfer. The DAP categorises procurement under “Buy Indian,” “Buy and Make Indian,” and other classifications to prioritise domestic industry.
India is also a signatory to international export control regimes such as the Missile Technology Control Regime (MTCR), which influences its defence technology cooperation.
Technological Advancement and Strategic Deterrence
Modern warfare increasingly depends on advanced technologies such as artificial intelligence, cyber capabilities, drones, and space-based surveillance. Indigenous research through DRDO has produced missile systems like Agni and Akash, enhancing strategic deterrence.
The induction of the Light Combat Aircraft (LCA) Tejas represents a milestone in indigenous aerospace capability. Naval shipbuilding programmes, including aircraft carriers and submarines, underscore India’s maritime ambitions.
Space-based assets for communication and reconnaissance strengthen network-centric warfare capabilities. The establishment of the Defence Space Agency reflects recognition of space as a strategic domain.
Technological self-reliance reduces dependence on foreign suppliers and enhances operational readiness. It also fosters innovation ecosystems linking academia, startups, and defence industries.
Economic and Industrial Implications
Defence manufacturing has significant multiplier effects. It stimulates sectors such as metallurgy, electronics, software, and advanced materials. The government has set ambitious targets for defence exports, aiming to transform India into a net exporter.
The corporatisation of ordnance factories aims to enhance efficiency, accountability, and competitiveness. By converting them into government-owned corporate entities, the reform seeks to align them with modern industrial practices.
Foreign Direct Investment (FDI) limits in defence have been liberalised, allowing up to 74% through the automatic route and higher through government approval. This encourages joint ventures and technology transfer.
However, balancing foreign investment with strategic autonomy remains a delicate task. Excessive reliance on foreign capital could undermine indigenous capability.
Strategic Environment and Geopolitical Considerations
India faces a complex security environment, including unresolved border issues with China and Pakistan. The Doklam standoff and Galwan clashes underscored the need for rapid deployment and advanced equipment.
In the maritime domain, China’s increasing presence in the Indian Ocean necessitates naval modernisation. The Indo-Pacific concept has gained prominence, with India participating in multilateral forums such as the Quad alongside the United States, Japan, and Australia.
Defence cooperation agreements, including logistics and technology-sharing arrangements, complement domestic manufacturing efforts. However, strategic autonomy remains a guiding principle.
Defence modernisation thus serves both deterrence and diplomatic leverage. A robust defence industrial base enhances India’s credibility as a security partner.
Challenges and Structural Constraints
Despite progress, several challenges persist.
First, research and development expenditure as a percentage of GDP remains modest compared to advanced economies.
Second, delays in procurement processes can hamper timely modernisation.
Third, coordination between public sector units and private industry requires improvement.
Fourth, technology gaps in areas like jet engines and advanced electronics remain significant.
Fifth, export competitiveness depends on quality assurance and after-sales support.
Addressing these constraints requires long-term policy stability and sustained investment.
Way Forward
A comprehensive strategy for defence modernisation should include increased R&D spending, particularly in emerging technologies such as quantum computing and hypersonic weapons.
Strengthening collaboration between academia and industry can accelerate innovation.
Streamlining procurement timelines and enhancing transparency will improve efficiency.
Skill development programmes focused on defence manufacturing can create a specialised workforce.
Export promotion through defence diplomacy can open new markets in Africa and Southeast Asia.
Ultimately, defence modernisation must integrate strategic, technological, and economic objectives.
Relevance for UPSC and SSC Examinations
For UPSC Prelims, aspirants should understand key defence reforms, institutions like DRDO, and concepts such as negative import lists.
For UPSC Mains (GS Paper III), the topic is directly relevant under internal security, defence technology, and indigenisation of technology.
For GS Paper II, it connects with India’s foreign policy and international relations.
For SSC examinations, questions may focus on recent defence initiatives, institutions, and basic facts about indigenous platforms.
In conclusion, India’s defence modernisation under Atmanirbhar Bharat represents a strategic recalibration toward self-reliance and technological empowerment. It strengthens deterrence, stimulates economic growth, and enhances India’s standing in global security architecture. While challenges remain, sustained reforms and innovation can transform India into a formidable defence manufacturing hub, reinforcing both national security and economic resilience.