Key facts
- India's defense output reached a record $18.7 billion in the 2025-26 financial year.
- The private sector contributed $4.4 billion, or 24%, to this output.
- Private firms are increasing their role in producing drones, surveillance systems, and ammunition.
- Analysts note a deficit in technology and capabilities among private defense companies.
- India continues to rely on public sector entities and foreign collaborations for critical military systems.
India's defense sector is experiencing significant growth, with a record $18.7 billion in output for the 2025-26 financial year, a substantial portion of which is now coming from the private sector. Private companies contributed $4.4 billion, representing 24% of the total output, and are increasingly involved in producing drones, surveillance systems, ammunition, and components. Defence Minister Rajnath Singh attributed this success to policy support, new initiatives, and growing private participation. However, analysts like Rahul Wankhede from the Manohar Parrikar Institute for Defence Studies and Analyses caution that this growth does not signify full self-reliance. He stated that private firms are currently complementing state-owned manufacturers rather than displacing them. India's armed forces require a wide range of equipment, from basic components to highly complex systems such as aero-engines, advanced sensors, missiles, aircraft, and submarines. In many of these critical technology areas, the country still depends on public sector development, the Defence Research and Development Organisation (DRDO), or foreign technology collaborations. Therefore, it is premature to conclude that private firms can meet the entire spectrum of military requirements.