Context:
Recently, the Union Minister of Defence highlighted that India’s defence exports have crossed ₹21,000 crore in 2023-24.
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India’s defence exports have surged from ₹1941 crore in FY 2014-15 to ₹21,083 crore in FY 2023-24, an increase of over 30 times in export value over the past decade.
The defence exports have grown by 31 times in the last 10 years as compared to the Financial Year 2013-14.
The private sector and the Defence Public Sector Undertakings (DPSUs) have contributed about 60% and 40% respectively.
A comparative analysis of two decades, the period from 2004-05 to 2013-14 and 2014-15 to 2023-24 reveals a growth of 21 times in the defence exports.
India has set the target to achieve defence exports of ₹50,000 crore by 2029.
Currently, India exports to over 100 nations, with the top three defence export destinations in 2023-24 being:
- USA
- France
- Armenia
Key Government Initiatives for Defence Exports
- Liberalized FDI Policy: Increasing the FDI limit from 49% to 74% under the automatic route in the defence sector in 2020, and up to 100% through the Government Route for those likely to result in access to modern technology.
- Defence Acquisition Procedure (DAP), 2020: Promotes domestic design and production of defence products and supports the fundamental principles of the Aatmanirbhar Bharat Abhiyan.
- Line of Credit: Offered to Friendly foreign countries to purchase Defence equipment.
- Defence Industrial Corridors (DICs): Establishment of two DICs, one each in Uttar Pradesh and Tamil Nadu, for defence manufacturing.
- Innovations for Defence Excellence (iDEX) scheme: Launched to involve startups and Micro, Small, and Medium Enterprises (MSMEs) in defence innovation.
- Indigenization Portal: Launch of the Self-Reliant Initiatives through Joint Action (SRIJAN) portal to facilitate indigenization by Indian industry, including MSMEs.