What Happened
- India's defence exports in FY 2025-26 reached a record Rs 38,424 crore (approximately USD 4.6 billion), a 62.7% surge over the previous fiscal year's Rs 23,622 crore.
- Defence Minister Rajnath Singh announced the milestone, stating that India is advancing toward becoming a global defence manufacturing hub.
- Defence Public Sector Undertakings (DPSUs) registered a 151% increase in exports, while private sector defence firms grew by 14%, with DPSUs accounting for 54.84% of total exports and private firms 45.16%.
- The number of registered defence exporters increased from 128 to 145, a 13.3% rise, reflecting the deepening base of India's defence industrial ecosystem.
- Indian-made defence equipment now reaches more than 80 countries, spanning missile systems, artillery, aircraft, and platforms developed by both public and private sector manufacturers.
- The achievement marks continued progress toward India's DPEPP 2020 target of Rs 50,000 crore in annual defence exports by 2030.
Static Topic Bridges
Defence Production and Export Promotion Policy (DPEPP) 2020
The Defence Production and Export Promotion Policy (DPEPP) 2020 is India's overarching policy framework for transforming the country into a major defence manufacturer and exporter. It sets a target of Rs 1.75 lakh crore in domestic defence production (including Rs 35,000 crore in exports) by 2025, and Rs 50,000 crore in annual defence exports by 2030. The policy prioritises indigenisation through two parallel tracks: government-owned DPSUs (like HAL, BEL, BDL, DRDO-developed platforms) and private manufacturers. The "positive indigenisation lists" — which ban imports of specified defence items and mandate domestic sourcing — are the primary tool driving this transition.
- Export target: Rs 50,000 crore/year by 2030.
- Domestic production target: Rs 3 lakh crore by 2029.
- Four Positive Indigenisation Lists released since 2021 — collectively covering 509+ items that must be procured domestically.
- FY26 domestic defence production already exceeds Rs 1.27 lakh crore (FY24 baseline).
- Defence Acquisition Procedure (DAP) 2020 operationalises DPEPP by categorising procurement into "Buy Indian," "Buy & Make," and similar preference categories.
Connection to this news: The FY26 export record confirms that the DPEPP framework is producing measurable results, with DPSUs' 151% surge particularly notable as larger government-owned platforms (missiles, aircraft) are clearing export pipelines developed over the past decade.
Innovations for Defence Excellence (iDEX) and the Defence Startup Ecosystem
The iDEX (Innovations for Defence Excellence) programme, launched in 2018 under the Ministry of Defence, is designed to foster defence innovation among startups and MSMEs through the Dare to Dream competition and Technology Development Fund grants. As of early 2025, iDEX has engaged 619 startups and MSMEs, with 430 contracts signed and over 549 problem statements issued by the Indian armed forces. The programme operates through the Defence Innovation Organisation (DIO), a not-for-profit entity jointly set up by Hindustan Aeronautics Limited (HAL) and Bharat Electronics Limited (BEL).
- Funding: Over USD 56 million allocated over five years.
- Contracts signed: 430+ (as of February 2025).
- Startups/MSMEs involved: 619+.
- Key products: Drones, AI-enabled surveillance systems, advanced materials, electronic warfare components.
- Links to export growth: Products qualifying for armed forces procurement increasingly enter the export pipeline once proven operationally.
Connection to this news: The growing private sector share of defence exports (45.16%) is partly attributable to iDEX-nurtured companies that have now scaled to export-ready production, signalling a structural broadening of India's defence export base beyond legacy DPSUs.
India as a Defence Exporter — Geopolitical Dimension
India's emergence as a defence exporter aligns with its broader foreign policy of strategic autonomy and Act East/Neighbourhood First policies. Key export destinations include Armenia (Pinaka multi-barrel rocket systems), the Philippines (BrahMos supersonic cruise missiles), Sri Lanka, Myanmar, Mauritius, Vietnam, and several African nations. Defence exports serve as instruments of strategic influence, deepening bilateral ties, creating interoperability with partner nations, and generating long-term supply, maintenance, and upgrade contracts. India has specifically leveraged the Russia-Ukraine conflict and Western supply-chain disruptions to position itself as a reliable alternative supplier.
- BrahMos missile exports: Philippines became the first export customer in 2022; multiple other countries in pipeline.
- Pinaka rocket systems: Exported to Armenia; inquiries from European and South-East Asian nations.
- India-Myanmar defence ties: Includes OPV and patrol vessel deliveries.
- Defence Attaché network: India has expanded its defence attaché presence in key partner countries to facilitate export negotiations.
Connection to this news: Exports reaching 80+ countries reflect both the breadth of India's defence product portfolio and the success of government-to-government (G2G) defence diplomacy that has accompanied Make in India initiatives.
Key Facts & Data
- FY26 defence exports: Rs 38,424 crore (record high)
- YoY growth: 62.7% (over FY25's Rs 23,622 crore)
- DPSU export share: 54.84% (grew 151% YoY)
- Private sector export share: 45.16% (grew 14% YoY)
- Registered defence exporters: 145 (up from 128; +13.3%)
- Countries receiving Indian defence equipment: 80+
- DPEPP 2030 target: Rs 50,000 crore/year
- Domestic defence production target by 2029: Rs 3 lakh crore
- iDEX contracts signed (as of Feb 2025): 430+