Indian Defence Industry

(Production)
2022

pg. 1
 Ministry of Defence

Defence research Department of Department of Department of Ex

Department of
and development defence Miliatry servicemen welfare
defence (DOD)
organisation(DRDO) production(DDP) affairs(DMA) (DESW)

The Department of Defence Production (DDP) was set up in November 1962 with the objective of developing a
comprehensive production infrastructure to produce the weapons/systems/platforms/equipments required for
defence. Over the years, the Department has established wide ranging production facilities for various defence
equipments through the Ordnance Factories and Defence Public Sector Undertakings (DPSUs). The products
manufactured include arms and ammunition, tanks, armoured vehicles, heavy vehicles, fighter aircraft and
helicopters, warships, submarines, missiles, ammunition, electronic equipment, earth moving equipment, special
alloys and special purpose steels.

pg. 2
 Defence production in India by sector US$Billion

Private companies
25%

Other PSUs and JVs

8%
DPSUs + OFB
67%

DPSUs + OFB Other PSUs and JVs Private companies

Value of defence production US$(Bn) Value of defence production by PSUs

US$(Bn)
11.85 7.5
12
7.09
11.5
11.5 7

10.9 6.42
11 6.5 6.31
10.7
6.04
10.5 6

10 5.5
2019 2020 2021 2022 2019 2020 2021 2022

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Highlights:

▪ Defence production in FY 2021-22 stood at Rs. 92,708 crore (US$ 11.85 billion).
▪ The Indian government has set the defence production target at US$ 25.00 billion by 2025 (including US$ 5
billion from exports by 2025).
▪ The government is taking several initiatives to encourage domestic manufacturing and reduce its external
dependence for defence procurement.
▪ In January 2021, Defence Research and Development Organisation (DRDO) announced that it will support at
least 30 start-ups every year to develop innovative products for Indian defence forces.
▪ The government announced measures under the ‘Make in India’ initiative, including raising foreign direct
investment (FDI) limit from 49% to 74% via the automatic route; this resulted in significant FDI inflows in the
defence and aerospace sector.

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 Defence exports in US$(Mn) No. of Defence authorities
2000 1000
1651.1 829
1537.53
1293.23 800 668
1500 633
977.57 600
1000 726.45
400 241 254 288
500 226.86
200 42
0 0
2017 2018 2019 2020 2021 2022 2015 2016 2017 2018 2019 2020 2021

▪ Defence exports in the country stood at Rs. 12,814.52 crore (US$ 1651.1 million) in FY 2021-22.
▪ Defence exports in the country witnessed strong growth in the last two years. India targets to export military
hardware worth US$ 5.00 billion (Rs. 35,000 crore) in the next 5 years.
▪ The 12th edition of DefExpo, India’s flagship event showcasing land, naval, air and homeland security systems
will be held in Gandhinagar, Gujarat, from March 10 to March 13, 2022. The aim of DefExpo-2022 is to build and
achieve ‘Aatmanirbharta’ (self-reliance) in defence and increase defence exports to US$5 billion by 2024.
▪ To boost the domestic defence sector manufacturing, the Ministry of Defence, in December 2020, approved the
export of indigenously developed surface-to-air Akash missile system and set up a panel to ensure faster
approvals for acquisition proposals by various countries.
▪ With an emphasis on promoting defence exports from the country, India Pavilion at Aero India 2021 - Bengaluru
will showcase a range of indigenously developed helicopters.
▪ In October 2020, India and the UAE have agreed to take their defence cooperation further through joint
production and mutual trade. This move is expected to boost domestic defence exports and achieve defence
export targets worth US$ 5 billion in the next five years.

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▪ India’s defence Import value stood at US$ 463 million for FY20 and is expected to be at
US$ 469.5 million in FY21.
▪ In February 2020, Defence Minister Mr. Rajnath Singh at Aero India 2021 announced to reduce defence imports
by at least US$ 2 billion by 2022.
▪ In August 2020, Defence Minister Mr. Rajnath Singh
announced to ban imports of 101 defence items to bolster, the Value of imports in US$(mn)
469.5
Prime Minister, Mr. Narendra Modi’s resolve to make India self- 470

reliant. This embargo on imports is planned to be progressively 468

implemented between 2020 and 2024. 466

464 463
▪ In September 2016, India agreed to purchase 36 Rafale fighter
jets from France for ~US$ 7.70 billion. Following this deal, 462

France delivered a set of three Rafale fighters to India in July 460

2021, boosting the Indian Air Force fleet. 458

2020 2021
▪ In August 2020, Defence Minister, Mr. Rajnath Singh,
launched the indigenisation portal ‘SRIJAN’, a one-stop shop, online portal for vendors interested to take up
items for indigenisation.
▪ In the first stage, the portal displayed those items that were imported in 2019-20 and are expected to import in
2020-21. This information could be helpful for the Indian manufacturers to design and develop defence products.
▪ In November 2020, Hindustan Times reported that India leased two MQ-9B Sea Guardian drones from the
United States, under the new Indian defense acquisition guidelines, which now permits the Indian Army to
temporarily lease hardware as opposed to buying the equipment outright.
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 Breakdown of defence services in Defence
Budget 2021-22 US$(Bn)

1.6

4.5 7.5

Air force Army Navy DRDO

In the Union Budget 2022-23:

• Ministry of Defence has been allocated Rs. 525,166 crore (US$ 67.66 billion)
• This includes expenditure on salaries of armed forces and civilians, pensions, modernisation of armed forces,
production establishments, maintenance, and research and development organisations.
• The allocation to the Ministry of Defence is the highest (13%) among all ministries of the central government.
▪ Ministry of Defence (MoD’s) gap between resource requirement and allocation, which briefly narrowed from a
high of 30% in 2018-19 to 25% in 2019-20.
▪ Considering the requirements and various programmes of the three pipeline defence services, including
submarines and capital allocation (present and projected), a huge gap exists and will remain, until there is
increased government support for higher funding

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 INDUSTRIES IN DEFENCE AND
THEIR PRODUCTS

ELECTRONICS,
ARMAMENT &
NAVAL AEROSPACE COMMUNICATION
AMMUNITIONS
& ICT

AOPV & OPV

ARMAMENT RADARS
FIB
AIRCRAFT AMMUNITIONS ELECTRONIC WARFARE
SUBMARINE
HELICOPTER MISSILES C4ISR
RESCUE & POLICE VESSEL
DRONES/UAVs/RPAs CIED CYBER DEFENCE
OTHER VESSELS
SYSTEM & EQUIPMENTS SIMULATION SURVILLANCE & SECURITY
UNDERWATER SYSTEMS
MAINTENANCE & LIFE CYCLE SUPPORT MAINTENANCE & LIFE CYCLE SUPPORT SIMULATION
SIMULATION
ANCILLARY INDUSTRY & SPARE PARTS ANCILLARY INDUSTRY & SPARE PARTS MAINTENANCE & LIFE CYCLE SUPPORT
MAINTENANCE & LIFE CYCLE SUPPORT
ANCILLARY INDUSTRY & SPARE PARTS
ANCILLARY INDUSTRY & SPARE PARTS

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COMPANIES ON THE BASIS OF INDUSTRY:

Armament and Electronic,

Land industry Naval industry Aerospace industry
ammunitions communication & ICT
• ARMOURED • GARDEN REACH • DYNAMATIC • ADVANCED • ALPHA DESIGN
VEHICLE NIGAM SHIPBUILDERS AND TECHNOLOGIES LTD WEAPONS AND TECHNOLOGIES PVT
LTD. (AVNL) ENGINEERS LTD • GLIDERS INDIA LTD EQUIPMENTS INDIA LTD
• ASHOK LEYLAND • GOA SHIPYARD LTD • HINDUSTAN LTD • BHARAT
LTD. • HINDUSTAN AERONAUTICS LTD • BHARAT DYNAMIC ELECTRONIC LTD
• BEML LTD SHIPYARD LTD LTD • INDIA OPTEL
• BHARAT FORGE LTD • LARSEN AND • BRAHMOS LIMITED
• MAHINDRA TOUBRO AEROSPACE • TATA ADVANCED
DEFENCE SYSTEMS • MAZAGON DOCK • MUNITIONS INDIA SYSTEMS LTD
LTD SHIPBUILDERS LTD LTD
• MISHRA DHATU • SHOFT SHIPYARD
NIGAM LTD LTD
• MKU LTD
• SMPP PRIVATE LTD
• TROOP COMFORTS
LTD
• YANTRA INDIA LTD
• ZEN TECHNOLOGIES
LTD

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GROWTH DRIVERS:

pg. 10
KEY PLAYERS AND VALUE OF PRODUCTION(2021):

• Rs.2,043cr • Rs.22,700cr

BHARAT HINDUSTAN
DYNAMICS AERONAUTICS
LTD LTD

BHARAT BHAREAT
EARTH ELECTRICALS
MOVERS LTD LTD

• Rs.3,556cr • Rs.13,947cr

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STRENGTHENING THE DEFENCE MANUFACTURING INDUSTRY:
FOCUSING ON SUPPLY CHAIN MANAGEMENT

• Key defence manufacturing players are focusing on supply chain management, for example, HAL implemented the ‘Public
Procurement Policy’ for micro and small enterprises (MSEs) and achieved >25% procurement from MSE Entrepreneurs.

AUTOMATING ARMED FORCES MEDICAL STORES DEPOT

• Radio-based telemedicine will connect isolated posts to Regimental Aid Post (RAP). Telemedicine equipment such as
Portable Physiological Vital Para Monitor (PPVPM)’ can ensure efficient operations to aid battlefield nursing assistants.

DEVELOPING AI BASED CAPABILITIES

•According to data released by the Department of Defence Production, 68 artificial intelligence (AI) projects in the field of
defence have been planned upto March, 2024, with 40 AI projects already completed as on 30 April,2022.
• Key defence manufacturing players are focusing on developing AI-based technologies for their platforms/equipment. E.g.,
designing and prototyping remotely operated vehicles (ROV), sleep/fatigued operator alert system on dump trucks.

LOCAL DESIGNING AND DEVELOPMENT OF PRODUCTS

•Key defence manufacturing companies are currently focussing on designing and developing various indigenous weapons and
essential products to boost domestic manufacturing capabilities and align with Hon’ble Prime Minister’s vision of
Aatmnirbhar Bharat.

LEVERAGING IT FOR EFFICIENT DEFENCE OPERATIONS

•Development of an indigenisation portal for all defence PSUs and ordnance factories can ensure seamless search experience
for stakeholders for processes such as online registration of vendors expressing interest for indigenising a product.

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Disclaimer:

This presentation is for information purposes only. While due care has been taken
during the compilation of this presentation to ensure that the information is accurate to
the best of my knowledge and belief, the content is not to be construed in any manner
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 Report by-

Yashpreet Singh Gill

Data source:
• : IBEF
• Ministry of Defence
• Department of Defence production

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