GS3 – Internal Security
Context
The execution of Operation Sindoor significantly bolstered India’s global defence export profile, with sharp rises in international demand for indigenous platforms like BrahMos, Akash, stealth aircraft, and laser weapons.
Role of Operation Sindoor in Boosting Exports
- Combat Proven Credibility: Live deployment of BrahMos and Akash missiles increased global trust in Indian weapon systems.
- Exposure of Adversary Weaknesses: Failures of Chinese-imported weapons used by Pakistan enhanced the appeal of Indian alternatives.
- Diplomatic Campaign: India briefed nearly 70 countries, showcasing real-time performance of its systems.
- Global Media Spotlight: International coverage of the operation raised visibility and credibility of Indian defence products.
- Strategic Signalling: Operation Sindoor demonstrated India’s ability to project power and reliability—key to attracting buyers.
Trends and Statistics
- Export Growth: Jumped from ₹686 crore (2013–14) to ₹23,622 crore (2024–25).
- Private Sector Dominance: Accounted for ₹15,233 crore (~65%) of total defence exports.
- Defence PSUs: Reported 42.85% growth, supported by procedural reforms.
- Export Destinations: Nearly 80 countries; major importers include the USA, France, and Armenia.
- Key Products: BrahMos, Akash missiles, UAVs, artillery, radars, Dornier aircraft.
Drivers of Defence Export Growth
- Policy Liberalisation: Enabled private sector participation in production and exports.
- Regulatory Improvements: Online clearances, de-licensing, and reduced procedural delays.
- Cost Advantage: Competitive pricing due to scale and efficient manufacturing.
- G2G Agreements: Facilitated exports through diplomatic and inter-governmental channels.
- EXIM Bank Support: Provided low-interest credit for international buyers.
- Global Demand Spike: Post-Ukraine war military rearmament created demand for affordable, reliable systems.
- Focus on Indigenisation: Nearly 75% of India’s capital defence outlay is reserved for domestic production.
Challenges Hindering Defence Exports
- Compliance with International Humanitarian Law (IHL): No mandatory review of buyers’ human rights records.
- Technological Dependency: Reliance on imported components like engines and sensors.
- Intense Competition: Global defence markets dominated by the US, France, Russia, and China.
- Bureaucratic Hurdles: Complex procurement and approval processes slow down response time.
- Industrial Constraints: Weak supply chains, outdated PSU practices, and limited MRO (maintenance, repair, overhaul) infrastructure.
- Geopolitical Risks: Exports to sensitive regions may lead to diplomatic repercussions.
Government Initiatives
- DPEPP 2020: Aims for ₹50,000 crore in defence exports by 2029.
- Import Ban Lists: Over 5,000 items progressively banned from imports to promote local production.
- iDEX Scheme: Funding over 250 startups for innovative, export-ready defence technologies.
- Industrial Corridors: Defence-focused manufacturing hubs in Tamil Nadu and Uttar Pradesh.
- Strategic Partnership (SP) Model: Encourages co-development with global firms for global supply.
- Export Reforms: 1,762 export approvals granted digitally in FY25 (17% annual growth).
- Empowering Defence Attachés: Resources and authority granted for export promotion abroad.
Way Forward
- Invest in R&D for critical components like engines and avionics to reduce dependency.
- Introduce a single-window digital clearance system to speed up approvals.
- Expand G2G ties in Africa, ASEAN, and Latin America for new markets.
- Support MSMEs and supply chains through incentives and targeted support.
- Promote “Brand India” through international expos and defence fairs.