India has embarked on a transformative initiative to open its highly sensitive defense production sector, particularly in the realm of conventional missile systems, to private companies. This significant policy shift, approved by Defense Minister Rajnath Singh, marks a departure from decades of state-dominated manufacturing and research, aiming to accelerate domestic production, reduce import dependency, and foster a robust indigenous defense industrial base. The move allows private entities to vie for technology and production rights for a wide array of missile systems developed by the state-run Defence Research and Development Organisation (DRDO).
Strategic Leap Towards Private Defense Manufacturing
The Indian Ministry of Defense announced that the transfer of DRDO-developed technologies for all conventional missile systems to the private sector is a pivotal step. This strategic decision is designed to streamline the transition of missile systems from development to mass production, thereby enhancing national security capabilities. The initiative is expected to create substantial opportunities for Micro, Small, and Medium-sized Enterprises (MSMEs) and other technology partners to integrate into the defense supply chain. DRDO has pledged its commitment to collaborating closely with Indian industries to facilitate the absorption of advanced defense technologies and bolster the nation’s self-reliance in defense manufacturing.
The scope of this technology transfer is extensive, encompassing a broad spectrum of missile types. Experts anticipate that this will include surface-to-air missiles, air-to-air missiles, anti-radiation missiles, anti-tank systems, and more formidable weaponry like land-attack cruise missiles. This comprehensive approach underscores India’s ambition to build a formidable domestic defense ecosystem capable of meeting diverse strategic requirements.
Driving Force: Atmanirbhar Bharat and Geopolitical Imperatives
The impetus behind this significant policy revision stems from Prime Minister Narendra Modi’s vision of "Atmanirbhar Bharat," or a self-reliant India, particularly in the defense sector. Historically, India’s defense production has been heavily reliant on state-owned enterprises, with companies like Bharat Dynamics holding a virtual monopoly in missile manufacturing. This new policy dismantles that exclusivity, enabling private players to ascend the value chain and become prime integrators of complex weapon systems.
Beyond the push for self-sufficiency, recent geopolitical developments have injected a renewed urgency into India’s defense preparedness. The nation faces persistent security challenges along its borders with nuclear-armed rivals Pakistan and China. India’s defense budget has seen a substantial increase, more than doubling from $38 billion in 2014 to an estimated $86 billion in the current fiscal year. The defense budget for the current year alone represents a 16% increase over the previous year, signaling a clear prioritization of national security.
The experiences of recent conflicts, such as the brief but intense war with Pakistan and ongoing global geopolitical shifts, have highlighted the critical need for robust defense manufacturing capabilities and substantial stockpiles. The rapid depletion of inventories in modern warfare necessitates the ability to replenish them quickly. Furthermore, the threat of adversaries degrading existing stockpiles with precision-strike systems underscores the importance of a resilient and expansive indigenous defense industrial base. India’s strategic calculations are heavily influenced by the formidable military might of China, its most capable adversary. To effectively deter Beijing, India believes it must demonstrate an unyielding capacity to withstand and inflict severe attrition over extended periods of conflict.
Building a Tri-Services Conventional Missile Force
To support this strategic objective, India is actively establishing a tri-services conventional missile force. The effectiveness and sustainability of such a force are intrinsically linked to "magazine depth"—the ability to maintain substantial and readily available munitions. Achieving this level of operational readiness is deemed impossible without the active and significant participation of the private sector in missile production. This move signals a clear intent to leverage private enterprise to meet the demanding logistical requirements of a modern, high-intensity warfare scenario.
India’s Expanding Defense Industrial Landscape
India’s private defense industry has been on a significant growth trajectory. In recent months, the nation has announced substantial investments in domestic defense manufacturing. In June, India revealed plans to procure over $2 billion worth of military drones from local manufacturers, reflecting the rapid expansion of the private sector in this domain. More than 600 companies, including major conglomerates like Adani, Larsen & Toubro, and Tata Advanced Systems, as well as numerous startups, are actively involved in India’s drone industry.
Further underscoring this trend, in July, India approved the acquisition of various military equipment valued at $5.46 billion, which included missiles, electronic warfare systems, and Kamikaze drones. The Indian Navy is also undergoing a significant modernization drive, with plans to procure at least 75 ships and submarines, predominantly built domestically, to counter China’s growing maritime influence in the Indian Ocean. Concurrently, India is diversifying its sources of military hardware, gradually reducing its long-standing reliance on Russia and expanding defense partnerships with nations like the United States, France, and increasingly, Israel.
Private Sector’s Growing Missile Manufacturing Capabilities
Private arms manufacturers in India have been channeling significant investments into bolstering their military production capacities. Major Indian conglomerates have made substantial investments in areas such as ammunition, drones, aerospace, and military electronics. Increasingly, these entities are establishing facilities dedicated to missile manufacturing. For instance, Adani Defence & Aerospace, a prominent player and an associate of Prime Minister Modi, announced plans in 2024 to invest over 30 billion rupees (approximately $315 million) in ammunition and missile manufacturing facilities in Uttar Pradesh. These planned facilities are intended to encompass capabilities for handling explosives crucial for missile production and precision munitions.
However, the success of this ambitious endeavor hinges significantly on government procurement policies. Experts note that manufacturing missiles is an exceedingly complex and capital-intensive undertaking. Private companies will need to make substantial investments in infrastructure, technology, and skilled personnel. These investments will only prove viable if the government places sufficiently large orders to justify the capital outlay and, crucially, allows these companies to generate profits that can be reinvested into research and development. The government’s commitment to sustained and substantial orders will be a critical determinant of the private sector’s ability to scale up and meet the military’s demands.
India’s Diverse Missile Arsenal
India possesses a formidable array of both ballistic and cruise missiles, many of which are dual-capable for both conventional and nuclear warheads. In May, the nation successfully test-fired the Agni-V, its most advanced nuclear-capable intercontinental ballistic missile. With a range of 5,500 kilometers (3,418 miles), the Agni-V can reach targets across China, the Middle East, and even parts of Europe. The Indian arsenal also includes shorter-range ballistic missiles like the Prithvi-1 (150 km) and longer-range variants such as the Agni-IV (4,000 km), providing strategic depth for various conflict scenarios.
In the realm of cruise missiles, India boasts the BrahMos, a supersonic missile co-developed with Russia, with a range of up to 500 kilometers (311 miles). The BrahMos played a role in recent military operations and remains a key component of India’s offensive capabilities. The breadth of these missile systems underscores the strategic importance of the current policy to enhance domestic production and technological advancement.
Expanding Defense Exports Amidst Domestic Growth
India has witnessed a dramatic surge in its military exports in recent years. Exports have climbed from a modest $72 million in the 2014-15 fiscal year to an impressive $4 billion in 2025-2016. Companies like Paras Defence, a rapidly growing manufacturer, anticipate their exports to more than double in the 2026-27 financial year, reaching $14 million, partly driven by increased demand linked to conflicts in the Middle East.
Indian defense manufacturers are also actively pursuing joint ventures with international companies. Adani Defence, in partnership with Israel’s Elbit Systems, is involved in the production of Hermes 900 armed drone systems. Investigations have also revealed India’s export of rocket parts and ammunition to Israel, even as the Indian government publicly advocated for diplomatic solutions to the conflict in Gaza. Amnesty International has raised concerns that these arms exports to Israel could make India complicit in alleged human rights violations in Gaza.
Beyond components, India is also exporting complete missile systems. In 2022, the Philippines acquired three batteries of BrahMos missiles from India. Since then, Vietnam and Indonesia have also signed deals for BrahMos missile purchases, and India has submitted proposals to the United Arab Emirates for similar supplies. This expanding export market demonstrates India’s growing capability and global recognition in defense manufacturing.
Towards a Domestic Military-Industrial Complex?
The recent announcement to share missile secrets with the private sector appears to be a deliberate step towards cultivating a more comprehensive domestic military-industrial complex. Earlier this year, the government shortlisted private firms for the manufacturing of the nation’s next-generation fighter jets, including Tata Advanced Systems and Bharat Forge. These companies are also emerging as significant producers of artillery systems, ammunition, and aerospace components. While India possesses indigenous fighter jet capabilities, it continues to import advanced aircraft like the Rafale from France and relies heavily on Soviet-era jets.
While India’s ambition to build a broader defense industrial base is evident, experts suggest it is still a considerable distance from developing a military-industrial complex comparable to those that have raised concerns in other nations. Power and decision-making in India’s defense sector remain overwhelmingly concentrated within the government. The long-term development of such a complex will depend on sustained policy support, consistent investment, and the ability of private entities to navigate the intricate regulatory and operational landscape of defense manufacturing.
Persistent Reliance on Military Imports
Despite the significant strides in domestic manufacturing and exports, India remains a major importer of military hardware. According to the Stockholm International Peace Research Institute (SIPRI), India was the world’s second-largest importer of weapons between 2021 and 2025. Russia continued to be India’s primary supplier during this period, accounting for 40% of its imported arms. This sustained reliance on imports highlights the ongoing challenges and the scale of India’s defense modernization efforts.
Navigating the Risks of Sensitive Technology Transfer
The transfer of sensitive technologies, such as missile secrets, to the private sector inherently carries risks, including the potential for data breaches and unauthorized dissemination. High-profile cyberattacks on defense manufacturers globally have underscored the vulnerability of private entities, which may possess less stringent security protocols than government laboratories.
However, in India’s context, the companies most likely to be involved in missile production are not new to the defense sector. Many have decades of experience in dealing with confidential and classified information, suggesting a foundational understanding of security protocols. Furthermore, the Indian government has strong incentives to ensure the security of this technology. It aims to prevent sensitive information from falling into the hands of adversaries and to comply with international arms control regimes like the Missile Technology Control Regime (MTCR). Adherence to MTCR provides India with significant strategic advantages, and the government’s commitment to upholding these standards is in its own self-interest. This suggests a measured approach to technology transfer, balancing the benefits of private sector involvement with robust security measures.
