India’s defence production hits record Rs 1.78 lakh crore in 2025-26

India's annual defence production reached an all-time high of Rs 1.78 lakh crore in the financial year 2025-26, according to data released by the Ministry of Defence on Wednesday. This figure marks a 15.6 per cent increase over the previous fiscal year's output of Rs 1.54 lakh crore, and a 110 per cent rise since 2020-21 when production stood at Rs 84,643 crore.

The ministry stated that indigenous defence production has grown nearly fourfold since 2013-14, when it was recorded at Rs 43,746 crore. Defence Public Sector Undertakings (DPSUs) and other public sector units accounted for approximately 76 per cent of the total production, while the private sector's contribution reached a record high of around Rs 42,000 crore, representing 24 per cent.

The growth reflects a broader push towards self-reliance in defence manufacturing, often termed 'Aatmanirbharta' in official communications. The increase in private sector participation indicates a structural shift in India's defence industrial base, moving beyond traditional public sector dominance. Government policies in recent years have aimed at encouraging private investment and technology transfer in the sector.

The defence production ecosystem encompasses a wide range of platforms including aerospace systems, naval vessels, armoured vehicles, electronics, and small arms. The rise in output is attributed to both domestic procurement by the armed forces and increased exports. India's defence exports have also witnessed a significant uptick, crossing Rs 20,000 crore in recent years, supported by policy reforms and streamlined licensing procedures.

Comparatively, global defence production has seen a surge due to geopolitical tensions, but India's growth rate remains notable among developing nations. However, experts caution that the production value must be seen in the context of India's total defence budget, which was over Rs 6 lakh crore in the same period, indicating that a substantial portion of equipment is still imported.

The Ministry of Defence did not provide a detailed break-up of the production by type or a list of major projects. It noted that the figures are provisional and subject to final audit. Analysts suggest that to sustain this growth, focus on research and development, quality control, and integration with global supply chains will be essential.

The government has set a target of Rs 3 lakh crore in annual defence production by 2028-29, along with exports of Rs 50,000 crore. Achieving these goals would require not only scaling up manufacturing capacity but also fostering innovation through startups and small enterprises in the defence technology sector.

In summary, the record production figure underscores a significant expansion of India's defence industrial capability, driven by both public and private sector efforts, against the backdrop of an evolving security environment.