India’s annual defence production reached a record ₹1,50,590 crore in 2024–25, marking an 18% increase from the previous year and a 90% jump compared with 2019–20, Defence Minister Rajnath Singh told Parliament on Friday.
Singh attributed the growth to policy reforms, greater private sector participation and a decade-long focus on indigenisation under the government’s Aatmanirbhar Bharat initiative. “The upward trajectory is a clear indicator of India’s strengthening defence industrial base,” he said, while acknowledging the role of Defence Public Sector Undertakings (DPSUs), other public-sector manufacturers and private firms.
According to data from the Ministry of Defence, DPSUs and other PSUs accounted for around 77% of total production in FY25, with the private sector contributing 23%, up from 21% in FY24. Output from DPSUs rose 16% during the year, while private sector production grew 28%.
The ministry said the increase in the private sector’s share reflected its expanding role in the defence manufacturing ecosystem. The growth, it added, was supported by measures to improve the ease of doing business, streamline procurement and boost domestic capabilities.
The record production figures come alongside a rise in defence exports, which reached ₹23,622 crore in FY25 — up 12% from ₹21,083 crore the previous year. The ministry said the export gains were in line with efforts to reduce import dependence and create a manufacturing base capable of meeting both domestic needs and international demand.
Since 2019–20, when total defence production stood at ₹79,071 crore, the sector has almost doubled its output. Officials said the pace of growth indicated the potential for further expansion, provided policy momentum and investment levels were maintained.
The government has been pursuing a strategy to increase indigenous content in defence systems, place restrictions on certain imports and encourage joint ventures between domestic and foreign manufacturers. In recent years, it has issued multiple “positive indigenisation lists” to signal procurement priorities to domestic industry.
While Singh welcomed the FY25 figures, some of industry observers note that sustaining double-digit growth will require steady orders from the armed forces, competitive pricing for exports and timely execution of projects.
The ministry said it expects the combination of public-sector capacity, private innovation and a growing export market to keep production on an upward trend in the coming years.
