{"id":34573,"date":"2024-12-31T18:28:08","date_gmt":"2024-12-31T12:58:08","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=34573"},"modified":"2024-12-31T18:28:10","modified_gmt":"2024-12-31T12:58:10","slug":"india-defense-exports","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/current-affairs\/31-12-2024\/india-defense-exports","title":{"rendered":"India\u2019s Defence Exports"},"content":{"rendered":"\n<p><strong>Syllabus: GS3\/Economy<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Context<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>As per the CareEdge Ratings report, India\u2019s defence sector production is set to grow at a compound annual growth rate (CAGR) of <strong>around 20%<\/strong> during FY24-FY29.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Major Highlights<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Budget Allocation:<\/strong> India\u2019s defence budget has consistently ranged between 1.90 to 2.8% of its gross domestic product (GDP).\n<ul class=\"wp-block-list\">\n<li>For the fiscal year 2024-25, Rs 6.22 lakh crore has been dedicated for the defence sector.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Indigenous Manufacturing:<\/strong> Supported by initiatives like \u2018Make in India,\u2019 the country is steadily reducing its reliance on foreign suppliers and advancing its defence capabilities.<\/li>\n\n\n\n<li><strong>Defence Exports: <\/strong>Over the last six years ending FY24, Indian defence exports have grown at a CAGR of approximately 28%.\n<ul class=\"wp-block-list\">\n<li>India\u2019s defence exports will grow at an estimated rate of about 19% during the next 5 years (i.e. from FY24 to FY29).<\/li>\n\n\n\n<li>India\u2019s defence exports include various products, such as aircraft, naval systems, missile technology, and military hardware.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>India&#8217;s Defence Export<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India has set a <strong>defence export target <\/strong>of \u20b950,000 crore by 2028-29.<\/li>\n\n\n\n<li><strong>Defence exports of India<\/strong> have touched Rs 21,083 crore in the FY 2023-24, a growth of <strong>32.5% <\/strong>over the last fiscal year.<\/li>\n\n\n\n<li>The private sector and the defence public sector undertakings (DPSUs) contributed around <strong>60% and 40%,<\/strong> respectively, in exports from India.<\/li>\n\n\n\n<li>The country is currently exporting military hardware to around<strong> 85 countries,<\/strong> with around 100 local firms involved.<\/li>\n\n\n\n<li>According to the Stockholm International Peace Research Institute, between 2000 and 2023, <strong>Myanmar<\/strong> remained the largest importer of Indian weapons, accounting for 31% of India\u2019s exports and <strong>Sri Lanka<\/strong> followed at 19%.\n<ul class=\"wp-block-list\">\n<li>Mauritius, Nepal, Armenia, Vietnam, and Maldives were other major importers.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>India\u2019s defence production <\/strong>grew substantially from Rs 74,054 crore in 2016-17 to Rs 108,684 crore in 2022-23.\n<ul class=\"wp-block-list\">\n<li>Out of this, 21.96% of the production was done by private companies.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full is-resized\"><img data-dominant-color=\"d2cab7\" data-has-transparency=\"false\" loading=\"lazy\" decoding=\"async\" width=\"639\" height=\"401\" src=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2024\/12\/Indias-defence-production-.webp\" alt=\"India's-defence-production\" class=\"not-transparent wp-image-34576\" style=\"--dominant-color: #d2cab7; width:591px;height:auto\" srcset=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2024\/12\/Indias-defence-production-.webp 639w, https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2024\/12\/Indias-defence-production--300x188.webp 300w\" sizes=\"auto, (max-width: 639px) 100vw, 639px\" \/><\/figure>\n<\/div>\n\n\n<h2 class=\"wp-block-heading\"><strong>Advantages of Growth in Defence Production<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Self-defence: <\/strong>The presence of hostile neighbors like China and Pakistan makes it necessary for India to boost its self-defence and preparedness.<\/li>\n\n\n\n<li><strong>Strategic advantage: <\/strong>Self-reliance will make India\u2019s geopolitical stance strategically stronger as a net security provider.<\/li>\n\n\n\n<li><strong>Technological advancement:<\/strong> Advancement in the defence technology sector will automatically boost other industries hence catapulting the economy further ahead.<\/li>\n\n\n\n<li><strong>Economic drain: <\/strong>India spends around 3% of GDP on defence and 60% of that is spent on imports. This leads to an immense economic drain.<\/li>\n\n\n\n<li><strong>Employment:<\/strong> Defence manufacturing will need the support of numerous other industries which generate employment opportunities.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Concerns<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Narrow Private Participation:<\/strong> Private sector participation in the defence sector is constrained by the lack of a conducive financial framework, that means our defence production is unable to benefit from modern design, innovation, and product development.<\/li>\n\n\n\n<li><strong>Lack of Critical Technology: <\/strong>Lack of design capability, inadequate R&amp;D investment, inability to manufacture major subsystems and components hamper indigenous manufacturing.<\/li>\n\n\n\n<li><strong>Lack of Coordination Between Stakeholders: <\/strong>India\u2019s defence manufacturing capability is hindered by overlapping jurisdictions between the Ministry of Defence and the Ministry of Industrial Promotion.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Government steps<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Simplification of Export Procedures<\/strong>: The government has introduced the India Defence Mart, an online portal for defence exports which enables companies to apply for export licenses and track their applications online.<\/li>\n\n\n\n<li><strong>Scheme for Promotion of Defence Exports (SPDE)<\/strong> to promote exports of defence products, which includes provision of financial support for attending international defence exhibitions, marketing, and publicity of Indian defence products abroad.\u00a0<\/li>\n\n\n\n<li><strong>Technology Upgradation Fund Scheme (TUFS)<\/strong> to encourage the modernization of the Indian defence industry.\n<ul class=\"wp-block-list\">\n<li>The scheme provides financial assistance for technological upgradation and modernization of manufacturing facilities.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li>The government has introduced a <strong>Strategic Partnership Model<\/strong> to boost domestic production of defence equipment through partnerships with foreign companies.\n<ul class=\"wp-block-list\">\n<li>The BrahMos missile is a testament to the strong defence cooperation between India and Russia.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li>Along with initiatives like <strong>Make in India,<\/strong> the GoI has established an <strong>Export Promotion Council (EPC)<\/strong> to encourage defence exports.<\/li>\n\n\n\n<li><strong>FDI in the Defence Sector<\/strong> has been enhanced up to 74% through the Automatic Route and 100% by Government Route, to promote export and liberalize foreign investments.<\/li>\n\n\n\n<li>The government has established <strong>2 dedicated Defence Industrial Corridors <\/strong>in the States of <strong>Tamil Nadu and Uttar Pradesh<\/strong> to act as clusters of defence manufacturing that leverage existing infrastructure, and human capital.\u00a0\u00a0<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Way Ahead<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Green Channel Status Policy (GCS)<\/strong> has been introduced to promote and encourage private sector investments in defence production to promote the role of private sector in defence production.\u00a0<\/li>\n\n\n\n<li>India has around <strong>194 defence tech startups<\/strong> building innovative tech solutions to empower and support the country\u2019s defence efforts.\u200b<\/li>\n\n\n\n<li>With the government&#8217;s emphasis on easing restrictions on foreign investment in order to achieve India&#8217;s goal of an <strong>Atmanirbhar Bharat,<\/strong> the growth trajectory of the Indian defence sector remains strong.<\/li>\n\n\n\n<li>The growth is a reflection of global acceptability of Indian defence products and technologies.<\/li>\n<\/ul>\n\n\n\n<p><strong>Source: <\/strong><a href=\"https:\/\/ddnews.gov.in\/en\/indias-defence-production-poised-to-clock-20-pc-annual-growth-in-fy-2024-29\/\" target=\"_blank\" rel=\"noopener\"><strong>DD<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>As per the CareEdge Ratings report, India\u2019s defence sector production is set to grow at a compound annual growth rate (CAGR) of around 20% during FY24-FY29.<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-34573","post","type-post","status-publish","format-standard","hentry","category-current-affairs"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/34573","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=34573"}],"version-history":[{"count":1,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/34573\/revisions"}],"predecessor-version":[{"id":34578,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/34573\/revisions\/34578"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=34573"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=34573"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=34573"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}