Expand domestic defence manufacturing and exports

The Defence Acquisition Council gave Acceptance of Necessity to proposals worth about ₹2.12 lakh crore; about 82% is planned from Indian industry. This is in-principle approval, not contracts or deliveries.

DRDO began Setting to Work Phase-2 for an indigenous submarine AIP energy module at L&T Hazira. Navy testing and Kalvari-class integration are still pending.

MoD signed an approximately ₹770-crore contract with Bharat Electronics for improved low-level lightweight radars for the Army. The signed contract supports domestic manufacturing, but radar production and delivery are not yet verified.

L&T-built INS Samarthak, with over 75% indigenous content, was commissioned into the Navy at Karwar. This is naval delivery, not evidence of exports or air and land platform indigenisation.

MoD approved simplified procedures for Indian industry use of proof ranges, firing ranges and laboratory test facilities. Testing charges were waived for specified iDEX, TDF, Make and other ministry developmental projects. This reduces procedural barriers; resulting additional production has not yet been measured.

MoD reported that HAL had delivered 63 AL-31FP engines against a 2024 order for 240 Su-30MKI engines, exceeding its second-year target of 60. It announced investment to raise annual AL-31FP capacity from 30 to 50 engines and plan a second Shakti line; the added capacity is not yet operational.

DDP simplified the Defence Export SOP and unified the Open General Export Licence framework, extending OGEL validity from two to three years and easing repeated authorisation requirements while retaining safeguards for sensitive destinations and items.

DDP notified 405 items with estimated business potential of ₹3,070 crore, including components for ALH, LUH, Su-30MKI, LCA, T-72, T-90 and BMP-II. Items have indicative development timelines and are to be sourced domestically after successful indigenisation; the list does not establish full-platform indigenous content.

MoD reported annual defence production of ₹1.78 lakh crore in FY2025–26, up 15.6% against the later FY2024–25 baseline of ₹1.54 lakh crore. Private-sector output was about ₹42,000 crore, or 24% of the total. Production value is an outcome, not a budget allocation.

Defence exports reached ₹38,424 crore in FY2025–26, up 62.66% from ₹23,622 crore. DPSUs contributed 54.84% and private companies 45.16%, providing measured evidence of export expansion.

Union Budget FY2026–27 earmarked ₹1.39 lakh crore, or 75% of the capital-acquisition budget, for procurement through domestic defence industries. This supports manufacturing and indigenisation; it is an annual allocation, not actual spending exclusively against this manifesto promise.

PIB’s November 2025 overview reported FY2024–25 defence production of ₹1.54 lakh crore and exports of ₹23,622 crore. The production figure is higher than the initial August 2025 report of ₹1,50,590 crore; later government records also use the ₹1.54-lakh-crore baseline.

MoD initially reported FY2024–25 production of ₹1,50,590 crore, up about 18% from ₹1.27 lakh crore, with private manufacturers contributing about 23%. Later official records use ₹1.54 lakh crore for FY2024–25; the historical announcement is retained with that distinction.

The Defence Acquisition Council accorded Acceptance of Necessity for ten Indian-IDDM capital-acquisition proposals worth about ₹1.05 lakh crore, including recovery vehicles, electronic warfare, missiles and naval systems. This is an approval milestone, not confirmation of contracts or completed deliveries.

Defence exports reached ₹23,622 crore in FY2024–25, up 12.04% from ₹21,083 crore in FY2023–24. Private firms contributed ₹15,233 crore and DPSUs ₹8,389 crore. These are annual export outcomes, not budget figures.

MoD notified a fifth Positive Indigenisation List of 346 items with estimated import-substitution value of ₹1,048 crore. It also reported over 12,300 items indigenised in the preceding three years. That cumulative result includes pre-election work; notification is not proof that all new items are already indigenous.