The year 2025 will be remembered as a defining chapter in India’s defence journey, when long-term policy intent translated decisively into manufacturing strength and technological confidence. From record-breaking production figures and surging exports to deeper private sector participation and rapid advances in defence technology, India’s push for Atmanirbharta in defence gathered unprecedented momentum during the year.
Record Production Signals Industrial Maturity
One of the most striking markers of 2025 was the all-time high defence production of around ₹1.51 lakh crore in FY 2024-25, reflecting an 18 per cent jump over the previous year. This surge underscored the growing depth of India’s defence industrial base, built steadily over the past decade through procurement reforms, indigenisation mandates and sustained budgetary support.
Defence Public Sector Undertakings (DPSUs) continued to anchor production, contributing about 77 per cent of the output, but the real story of the year was the rapid rise of private industry. The private sector’s share climbed to 23 per cent, with growth outpacing that of the public sector, signalling a more balanced and competitive ecosystem. MSMEs, startups and large private players increasingly became integral to supply chains across platforms, electronics, weapons and subsystems.
Exports Cross New Frontiers
2025 also marked a turning point in India’s defence exports. Shipments touched a record ₹23,622 crore, more than 12 per cent higher than the previous year and nearly 34 times the level seen a decade ago. Indian defence products – from radars, torpedoes and electronic warfare systems to patrol boats, helicopters and missile components – found buyers in over 100 countries.
The United States, France and Armenia emerged among the top destinations, reinforcing India’s growing credibility as a reliable defence supplier. Simplified licensing, digital export authorisations and Open General Export Licences played a key role in helping Indian companies access global markets with greater ease.
Policy Reforms Power the Momentum
Much of the progress in 2025 was rooted in policy continuity. The Defence Acquisition Procedure (DAP) 2020, with its priority for “Buy (Indian-IDDM)” categories, continued to steer major procurements towards indigenous platforms. Complementing this, streamlined procedures under updated procurement manuals improved transparency and reduced timelines, benefiting both large manufacturers and MSMEs.
The government’s emphasis on domestic sourcing was reflected in record indigenous procurement contracts signed during the year, with a majority of contract value awarded to Indian industry. Defence corridors in Uttar Pradesh and Tamil Nadu gained further traction, drawing investments, expanding infrastructure and laying the groundwork for long-term manufacturing clusters.
Defence Tech Takes Centre Stage
Beyond numbers, 2025 stood out for the growing role of defence technology. Indigenous development of drones, counter-UAS systems, electronic warfare suites, autonomous vessels and precision munitions gained pace. Institutions such as DRDO, working closely with industry and academia, accelerated technology transfers and prototype-to-production pathways.
Innovation platforms like iDEX and the Technology Development Fund strengthened the startup ecosystem, enabling young companies to deliver solutions in artificial intelligence, robotics, cyber security, sensors and advanced materials. The increasing deployment of AI-enabled systems and net-centric warfare capabilities reflected a shift from licence manufacturing to innovation-led defence preparedness.
Strategic Confidence Backed by Capability
India’s rising defence manufacturing and tech capacity also fed into strategic confidence during the year. Precision operations and robust air and missile defence responses highlighted the growing role of indigenous systems in operational readiness. The alignment between industrial capability and security doctrine became more visible than ever before.
Looking Ahead
As 2025 draws to a close, India’s defence sector stands transformed from where it was a decade ago. What was once characterised by import dependence and procedural delays is now marked by expanding factories, export orders and cutting-edge technology development. With ambitious targets of ₹3 lakh crore in defence manufacturing and ₹50,000 crore in exports by the end of the decade, the trajectory set in 2025 points to sustained acceleration.
More than just a year of records, 2025 cemented India’s emergence as a serious global player in defence manufacturing and defence technology – turning Atmanirbharta from a policy vision into an unfolding reality.
