BharatNotes
Introduction
India's defence sector has historically been marked by high import dependence — India was consistently the world's largest or second-largest arms importer (SIPRI data) for years. The government's Atmanirbhar Bharat (self-reliant India) initiative, launched in May 2020, made defence indigenisation a strategic priority, backed by a comprehensive policy architecture. This chapter covers the key mechanisms, achievements, and challenges in India's defence self-reliance programme.
From DPP to DAP — Policy Framework Evolution
Defence Procurement Procedure (DPP)
The Defence Procurement Procedure (DPP) was the governing framework for defence acquisitions. It underwent multiple revisions (DPP-2002, 2005, 2008, 2011, 2013, 2016) but was criticised for:
- Long procurement timelines (often 10–15 years from induction to delivery)
- Complex categories and offset clauses that were difficult to implement
- Limited focus on technology transfer and domestic production
Defence Acquisition Procedure (DAP) 2020
The Defence Acquisition Procedure 2020 (DAP-2020) replaced DPP-2016 and came into effect on 1 October 2020. It represents the most comprehensive reform of India's defence procurement architecture.
Key changes in DAP 2020:
| Feature | Details |
|---|---|
| Atmanirbharta focus | Introduced a priority order for procurement categories; "Buy (Indian-IDDM)" has the highest preference |
| IDDM category | Indigenously Designed, Developed and Manufactured — the highest preference; requires product to be Indian-designed with >50% indigenous content |
| Leasing category | New "Leasing" category added — allows Indian military to lease equipment instead of purchasing (reduces upfront capital expenditure) |
| Reduced timelines | Streamlined approval processes; aimed at cutting average procurement time |
| Offset clause revision | Offset policy revised — exempted "Buy (Global)" category from offset obligations below a threshold; simplified offset banking |
| FDI provision | Incorporated FDI limits: 74% under automatic route for certain categories; up to 100% under government approval route |
Note on FDI: The 74% automatic route applies to categories like "Buy (Indian)", "Buy and Make (Indian)", and "Buy (Global – Manufacture in India)". The 49% cap remains for more sensitive categories involving design and development. FDI up to 100% is possible via the government approval route for cutting-edge technology transfer.
Positive Indigenisation Lists (PILs)
The Positive Indigenisation List (PIL) is a mechanism to drive import substitution — items on the list cannot be imported after a specified date; they must be sourced domestically.
Two separate PIL tracks:
Track 1 — Department of Military Affairs (DMA) PILs (for Armed Forces)
- 5 PILs notified covering 509 items (complex systems: platforms, weapons, sensors, ammunition)
- Items include: artillery guns, light combat helicopters, radars, armoured vehicles, corvettes, frigates, transport aircraft
- Import embargo dates are phased over 2020–2030
Track 2 — Department of Defence Production (DDP) PILs (for DPSUs)
- 5 PILs notified for Defence Public Sector Undertakings covering 4,666+ items (systems, sub-systems, components, spares)
- Of these, 2,972 items (worth Rs 3,400 crore import substitution value) had already been indigenised as of mid-2024
- A fifth list of 346 items was notified in July 2024, with Rs 1,048 crore import substitution value
Combined impact: The PILs have created a captive domestic market for Indian defence industry, incentivising private sector investment in defence manufacturing.
iDEX — Innovations for Defence Excellence
iDEX was established in 2018 under the Defence Innovation Organisation (DIO), Ministry of Defence, to harness India's startup ecosystem for defence technology innovation.
Structure:
- Nodal body: Defence Innovation Organisation (DIO); funded by DRDO and two DPSUs (HAL and BEL)
- Operates Defence India Startup Challenges (DISC) — multiple rounds
Funding mechanisms:
- SPARK grants: Up to Rs 1.5 crore for prototype development under DISC/Open Challenge
- ADITI Scheme (Acing Development of Innovative Technologies with iDEX): Launched March 2024; Rs 750 crore corpus (FY 2023-24 to 2025-26); grants up to Rs 25 crore per startup for deep-tech, critical technologies (AI, quantum, semiconductors, autonomous systems)
Achievements (as of February 2025):
- 549 problem statements issued to industry
- 619 startups and MSMEs engaged on the iDEX platform
- 430 contracts awarded
- 26 products developed under iDEX have received procurement orders totalling over Rs 1,000 crore
- Acceptance of Necessity (AoN) or RFPs worth Rs 2,380 crore issued for 37 products
DRDO Achievements — Key Indigenised Systems
| System | Type | Status |
|---|---|---|
| LCA Tejas (Mk1A) | Light Combat Aircraft | Inducted into IAF; MRCA contract for 83 Mk1A signed (2021); Mk2 variant under development |
| Pinaka | Multi-barrel rocket launcher (MBRL) | Inducted; upgraded Pinaka Mk-II with extended range; exported to Armenia |
| Akash-NG (New Generation) | Short-range surface-to-air missile | Development ongoing; improved over Akash Mk1 inducted in IAF/Army |
| QRSAM | Quick Reaction Surface-to-Air Missile | Completed user trials (2022-23); designed for Army air defence |
| Astra | Beyond Visual Range air-to-air missile | Inducted in IAF; Astra Mk1 (80+ km range); Mk2 under development |
| DRDO-HEMRL Kaveri Engine | Jet engine for LCA Tejas | Under advanced development; India's first indigenous combat aircraft engine |
| Varunastra | Heavyweight torpedo | Indigenously developed; inducted in Indian Navy |
Make in India in Defence
OFB Corporatisation — 7 New DPSUs
The Ordnance Factory Board (OFB) — a government factory system with 41 factories employing over 70,000 workers — was dissolved and corporatised into 7 new Defence Public Sector Undertakings (DPSUs) effective 1 October 2021:
| DPSU | Products |
|---|---|
| Munitions India Limited (MIL) | Ammunition, explosives |
| Armoured Vehicles Nigam Limited (AVNL) | Tanks, armoured vehicles |
| Advanced Weapons and Equipment India Limited (AWE India) | Small arms, assault rifles |
| Troop Comforts Limited (TCL) | Troop comfort items, clothing |
| India Optel Limited (IOL) | Optical and opto-electronic equipment |
| Gliders India Limited (GIL) | Parachutes, gliders |
| Yantra India Limited (YIL) | Propellants, explosives, fuses |
Rationale: Corporatisation aimed to introduce accountability, efficiency, and commercial orientation; OFBs had faced criticism for delays, quality issues, and cost overruns.
Defence Corridors
Two Defence Industrial Corridors have been established to cluster defence manufacturing:
- Uttar Pradesh Defence Industrial Corridor — nodes at Agra, Aligarh, Chitrakoot, Jhansi, Kanpur, Lucknow
- Tamil Nadu Defence Industrial Corridor — nodes at Chennai, Coimbatore, Hosur, Salem, Tiruchirappalli
Defence Exports — The Transformation
India's defence exports have grown dramatically under the Atmanirbhar initiative:
| Year | Defence Exports |
|---|---|
| 2016-17 | Rs 1,521 crore |
| 2022-23 | Rs 15,920 crore |
| FY 2023-24 | Rs 21,083 crore (record at that time; 32.5% growth; private sector 60%, DPSUs 40%) — PIB confirmed |
| FY 2024-25 | Rs 23,622 crore (12.04% growth over FY24) |
| FY 2025-26 | Rs 38,424 crore (all-time record as of April 2026) |
Government target: Rs 50,000 crore (approx. $6 billion) in defence exports by 2029.
Export destinations: Over 100 countries; key items — BrahMos cruise missiles (Philippines), Pinaka rockets (Armenia), Dornier maritime patrol aircraft, radars, ammunition.
SIPRI Data — India's Import Trajectory
According to SIPRI (Stockholm International Peace Research Institute) data:
- India was the world's largest arms importer from 2008 to 2018 (10-year period)
- India's share of global arms imports declined from ~14% (2014-18 period) to ~9.8% (2019-23 period) — reflecting some success of indigenisation
- However, India remains among the top 3 arms importers globally
- Major suppliers: Russia (traditional, but share declining), France (Rafale jets, submarines), USA (C-130J, Apache, P-8I), Israel (drones, radars)
Exam Strategy
For Prelims:
- DAP 2020 effective date: 1 October 2020
- PIL (DMA): 5 lists, 509 items (armed forces import ban)
- PIL (DDP): 5 lists, 4,666+ items (DPSU import substitution)
- iDEX: 619 startups engaged; 430 contracts awarded; Rs 1,000 crore+ procurement orders (as of Feb 2025)
- ADITI scheme: Rs 750 crore; grants up to Rs 25 crore per startup
- OFB corporatised into 7 DPSUs effective 1 October 2021
- Defence exports FY 2023-24: Rs 21,083 crore (PIB confirmed)
- FDI in defence: 74% automatic route / 100% government route
For Mains (GS3):
- Atmanirbhar Bharat in defence: policy (DAP 2020) + import substitution (PIL) + innovation (iDEX) + production (OFB corporatisation, defence corridors) + exports
- Challenge: Most systems still rely on foreign sub-systems (engines, sensors, electronics); import substitution is at platform level, not full supply chain
- SIPRI context: India declining from largest importer to among top 3 — progress made but gap remains vs. China (which indigenised ~80% of defence needs)
- iDEX model: small-grant, fast-prototype, startup-driven innovation — applicable to other sectors (space, cybersecurity)
- Export growth: from Rs 1,521 crore (2017) to Rs 38,424 crore (2026) — 25x growth in a decade; connects to India's "Make for the World" narrative
