INDIA'S DEFENCE PRODUCTION (Syllabus: GS Paper 3 – Security/Economy)

News-CRUX-10     8th July 2024        
output themes

Context: India achieved its highest-ever growth in indigenous defence production value during FY 2023-24, as announced by the defence ministry.

India's Defence Production

  • Record-High Production in FY 2023-24: The value of defence production reached ₹1,26,887 crore, marking a 16.7% increase from the previous fiscal year.
  • Contribution Breakdown: DPSUs and other PSUs contributed 79.2%, while the private sector contributed 20.8% to the total defence production in 2023-24.
  • Growth Since 2019-20: Defence production has grown by over 60% from ₹79,071 crore in 2019-20 to ₹1,26,887 crore in 2023-24.
  • Range of Defence Products: India manufactures a diverse range of defence items including Tejas LCA, helicopters, warships, tanks, artillery guns, missiles, rockets, and military vehicles.
  • Defence Exports Surge: Defence exports in FY 2023-24 reached ₹21,083 crore, a 32.5% increase from the previous fiscal year, demonstrating robust growth.

Government Initiatives to Boost Defence Exports

  • IDR Act Reform: Rationalization of Defence Products list for Industrial License and extended validity from 3 years to 15 years.
  • iDEX and DTIS Schemes: Initiatives like iDEX and DTIS foster innovation and strengthen defence testing infrastructure to enhance defence manufacturing capabilities.
  • FDI Policy Enhancement: FDI limits in the Defence Sector increased up to 74% via Automatic Route and up to 100% via Government Route to attract foreign investments.
  • Defence Industrial Corridors: Established in Tamil Nadu and Uttar Pradesh to promote local defence manufacturing clusters leveraging existing infrastructure and human capital.
  • DPEPP 2020: Defence Production and Export Promotion Policy 2020 aims to bolster self-reliance and export capabilities through structured guidelines.