Operation Sindoor, conducted in response to the Pahalgam terror attack, showcased India’s burgeoning indigenous defence capabilities under the “Make in India” initiative. The operation highlighted the effectiveness of domestically developed military technologies, including drones, missiles, and air defence systems, which outperformed expectations, while foreign-supplied equipment from Turkey and China fell short. This report examines India’s transformation into a self-reliant defence manufacturing powerhouse, driven by strategic policy initiatives, increased defence budgets, and innovative programs such as Innovations for Defence Excellence (iDEX) and other schemes for drones.
India’s defence sector has undergone a remarkable transformation since the launch of the “Make in India” campaign on September 25, 2014, under Prime Minister Narendra Modi. The initiative aimed to foster self-reliance (Atmanirbhar Bharat) by promoting indigenous manufacturing and reducing dependence on foreign suppliers. “Operation Sindoor” exemplified this shift, demonstrating the operational success of homegrown technologies in a high-stakes conflict.
Growth in Defence Manufacturing
India’s defence production has seen unprecedented growth, reaching Rs 1.27 lakh crore in the fiscal year 2023-24, a 174 per cent increase from Rs 46,429 crore in 2014-15. This milestone reflects the success of government policies aimed at achieving self-reliance. Contributions from Defence Public Sector Undertakings (DPSUs), other public sector entities, and private enterprises have driven this surge, supported by streamlined procurement processes and incentives for domestic manufacturers.
The defence budget has grown significantly, from Rs 2.53 lakh crore in 2013-14 to Rs 6.81 lakh crore in 2025-26. This increase underscores India’s commitment to strengthening its military infrastructure. In 2023-24, Rs 1,11,544 crore (75 per cent of the modernisation budget) was allocated for procurement from domestic firms, prioritising indigenous production and fostering economic growth.
Strategic Initiatives Driving Self-Reliance
Make in India Campaign: Launched in 2014, the “Make in India” campaign has been a cornerstone of India’s defence transformation. By encouraging technological innovation and private sector participation, the initiative has enabled the development of advanced military platforms, reducing reliance on imports and positioning India as a global defence player.
Innovations for Defence Excellence (iDEX): Established in April 2018, iDEX has created an ecosystem for innovation in the aerospace and defence sectors. By February 2025, iDEX had signed 430 contracts and engaged 619 startups and MSMEs through 549 problem statements. With a budget of Rs 449.62 crore for 2025-26, iDEX provides grants of up to Rs 1.5 crore to MSMEs, startups, and R&D organisations, facilitating co-creation and access to testing infrastructure. Notable innovations include the Quantum Key Distribution (QKD) system, 4G/LTE TAC-LAN, Advanced Autonomous Systems, and Smart Compressed Breathing Apparatus.
Production-Linked Incentive (PLI) Scheme for Drones: Introduced in 2021, the PLI scheme for drones and drone components complements the liberalised Drone Rules of 2021. The scheme incentivises domestic manufacturing, targeting sectors such as agriculture, surveillance, and defence. By November 2024, the PLI initiative across 14 key sectors had attracted Rs 1.61 lakh crore in investments, generating sales of Rs 14 lakh crore. Drones like the Nagastra-1 and SkyStriker, used in “Operation Sindoor,” demonstrated surveillance and precision strike capabilities, underscoring India’s potential to become a global drone hub by 2030.
MAKE Projects: The MAKE procedure, introduced in the Defence Procurement Procedure (DPP-2006) and refined through amendments, promotes indigenous design and development. It includes three categories:
MAKE-I (Government Funded): Up to 70 per cent government funding (Rs 250 crore per agency) with a minimum 50 per cent Indigenous Content (IC).
MAKE-II (Industry Funded): Industry-funded projects for import substitution, requiring 50 per cent IC.
MAKE-III (Manufactured in India via ToT): Production through Technology Transfer, requiring 60 per cent IC.
These categories have accelerated the development of defence systems, ensuring rapid prototyping and production.
Self-Reliant Initiatives through Joint Action (SRIJAN): Launched in August 2020, SRIJAN encourages indigenisation by listing imported goods for domestic production. By February 2025, over 14,000 of 38,000 listed items had been indigenised, reducing reliance on foreign supplies.
Positive Indigenisation Lists (PILs): The Department of Defence Production (DDP) and Department of Military Affairs (DMA) have released five PILs, covering over 5,500 items, including LRUs, assemblies, and subsystems. By February 2025, more than 3,000 items had been indigenized, including assault rifles, corvettes, light combat helicopters, and radars.
Defence Industrial Corridors
Two Defence Industrial Corridors in Tamil Nadu and Uttar Pradesh have attracted significant investments. By February 2025, Rs 8,658 crore had been invested, with 253 Memorandums of Understanding signed, projecting Rs 53,439 crore in future investments. These corridors offer incentives to companies, boosting regional defence manufacturing.
Ease of Doing Business (EoDB)
The government has simplified regulations to attract investment. Key measures include:
Extending export authorisation periods for parts and components.
Reducing the number of defence products requiring production licenses (2019).
Extending defence license validity from three to fifteen years, with possible extensions to eighteen years.
Implementing an end-to-end digital export authorisation system, issuing over 1,500 approvals in the latest fiscal year.
Defence Exports and Global Presence
India’s defence exports have grown 30-fold, from Rs 686 crore in 2013-14 to Rs 21,083 crore in 2023-24. The United States is among the key customers, importing Indian armaments. This growth reflects India’s ability to produce high-quality, cost-effective defence equipment, supported by innovations in quantum-secure communication, AI-driven analytics, and counter-drone systems.
Operation Sindoor: A Case Study in Indigenous Capability
“Operation Sindoor” highlighted the operational superiority of India’s indigenous technologies. Domestically produced drones, such as the Nagastra-1 and SkyStriker (developed by Alpha Design and Elbit Security Systems), provided critical surveillance and precision strike capabilities. The Akash Surface-to-Air Missile (SAM) system effectively countered multiple threats, including UAVs, fighter jets, ballistic missiles, and unguided rockets, outperforming foreign systems like those from Turkey and China.
India’s industrial depth ensured a steady supply of munitions, including the Pinaka rocket launcher, capable of firing 72 rockets in 44 seconds. This capability, combined with joint ventures with Israeli and Russian firms, demonstrated India’s ability to sustain operations in high-intensity conflicts.
Policy Reforms and Industry Support
Liberalised FDI Policy
In September 2020, the government increased FDI limits in the defence sector to 74 per cent via the automatic route and above 74 per cent through the government route. From April 2000 to 2024, FDI inflows totalled Rs 5,516.16 crore, boosting domestic manufacturing.
TATA Aircraft Complex: Inaugurated in October 2024 in Vadodara, the TATA Aircraft Complex will produce 40 of 56 C-295 aircraft domestically, enhancing India’s aerospace capabilities.
Defence Testing Infrastructure Scheme (DTIS): DTIS supports the creation of eight Greenfield testing facilities, with seven already approved for unmanned aerial systems, electronic warfare, and communications, promoting indigenisation.
Manthan and Aero India 2025: The Manthan event at Aero India 2025 in Bengaluru showcased India’s defense innovations, uniting startups, MSMEs, and industry leaders. The “SAMARTHYA” theme highlighted 33 indigenous products, including nine iDEX projects and 24 developed by the Indian Navy, DRDO, and DPSUs.
Economic and Strategic Impacts
India’s defence manufacturing boom has created jobs, spurred innovation, and strengthened national security. The sector’s growth aligns with the broader goal of economic advancement, with defence corridors and PLI schemes generating significant investments and sales. Strategically, India’s ability to produce advanced weaponry and sustain supply chains positions it as a reliable global partner. The success of “Operation Sindoor” and the punitive actions against Pakistan for harbouring terrorism underscore India’s military prowess and serve as a deterrent to adversaries.
“Operation Sindoor” demonstrated the operational superiority of indigenous technologies, reinforcing India’s commitment to Atmanirbhar Bharat. With ambitious targets for 2029, India is poised to expand its global footprint, enhance national security, and drive economic growth, solidifying its status as a formidable player in the international defence arena.
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