Defence & SecurityImportant2025-04-01

India Achieves Record Defence Exports Milestone

In News

What Happened

On April 1, 2025, the Ministry of Defence announced that India's defence exports reached a record high of Rs 23,622 crore for the financial year 2024-25. This represents a 12.04 percent growth compared to the previous year. The private sector drove this growth by contributing Rs 15,233 crore, while Defence Public Sector Undertakings (DPSUs) accounted for Rs 8,389 crore.

Why It Matters

This milestone validates the success of the 'Make in India' and 'Atmanirbhar Bharat' initiatives in transforming India from a major arms importer to a growing exporter. It significantly strengthens India's strategic autonomy and keeps the country on track to achieve its target of Rs 50,000 crore in defence exports by 2029.

Background

History & Context

For decades, India was primarily known as one of the world's largest arms importers, heavily dependent on foreign suppliers. To build a self-reliant defence manufacturing ecosystem, the government drafted the Defence Production and Export Promotion Policy (DPEPP) 2020. Over the past few years, the Ministry of Defence has aggressively promoted domestic manufacturing through the SRIJAN portal and by releasing multiple Positive Indigenisation Lists, which embargo the import of specific defence items to encourage local production.

What Changed

▶
BEFORE: India's defence exports were minimal, standing at just Rs 686 crore in FY 2013-14. NOW: Exports have expanded exponentially, reaching an all-time high of Rs 23,622 crore in FY 2024-25.
▶
BEFORE: Defence manufacturing was heavily monopolised by state-owned enterprises with limited private sector participation. NOW: The private sector is the leading contributor to defence exports, generating Rs 15,233 crore compared to the Rs 8,389 crore from DPSUs.
▶
BEFORE: The armed forces imported most critical components without a structured indigenisation timeline. NOW: Positive Indigenisation Lists legally restrict the import of thousands of components, mandating procurement from domestic manufacturers.

Prelims Angle

NCERT Connection

This development illustrates concepts from Class 12 Macroeconomics Chapter 6 - Open Economy Macroeconomics. A surge in defence exports increases the inflow of foreign exchange, improving India's balance of trade and positively impacting the Current Account balance within the Balance of Payments (BoP).

Practice Questions

Q1

Correct Statement(s)

Which of the following statements is/are correct regarding India's defence exports in FY 2024-25? 1. The private sector contributed a larger share to the total defence exports than the Defence Public Sector Undertakings (DPSUs). 2. The Government of India has set a target to achieve Rs 50,000 crore in defence exports by the year 2029.

Up next