India’s defense exports reached an all-time high of Rs 38,424 crore in fiscal year 2025-26, marking 62 percent growth over the previous year, according to government data cited in official briefings. The milestone reflects a sustained push to transform India from one of the world’s largest arms importers into a significant exporter of military equipment.
Defense exports have grown roughly 31-fold over the past decade, driven by policy reforms encouraging private sector participation and streamlined licensing procedures. Indian shipyards now build vessels accounting for 11 percent of the Norwegian Shipowners Association order book, illustrating deepening maritime ties with Nordic partners.
The government allocated Rs 2.19 lakh crore in defense capital outlay for FY26, with a record 75 percent reserved for domestic industry procurement. Officials say the emphasis on indigenous manufacturing supports employment, technology transfer and strategic autonomy amid global supply chain disruptions.
Despite export growth, defense public sector undertakings still control about 70 percent of domestic production, creating an uneven playing field for private firms seeking larger contracts. Analysts say further liberalization is needed to unlock the full potential of India’s defense industrial base.
Prime Minister Narendra Modi highlighted defense cooperation during the India-Nordic Summit in Oslo, where leaders noted increased momentum in industrial collaboration. Nordic countries acknowledged investment opportunities including 100 percent foreign direct investment offered to defense firms in Indian industrial corridors.
Private defense manufacturers including firms in aerospace, shipbuilding and electronics have expanded export portfolios to Southeast Asia, Africa and the Middle East. Government export promotion cells provide marketing support at international defense exhibitions where Indian systems compete with established global suppliers. The 62 percent year-on-year export growth figure reflects both increased volume and higher-value platforms including naval vessels and avionics packages. Defense economists caution that sustaining growth requires consistent quality certification and after-sales maintenance networks that smaller exporters struggle to maintain. Indian defense attachés in Nordic capitals are coordinating follow-up meetings with manufacturers interested in joint ventures under new FDI rules. Industry associations representing small defense suppliers requested simplified certification pathways to participate in export growth initiatives. Officials said additional updates would be provided as investigations and policy reviews continue in the coming days. Stakeholders on all sides are monitoring developments closely for indications of further action or revised guidance from relevant authorities.
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