Defense production and arms export touched new heights, now emphasis on increasing capacity, special focus on Air Force in 2025

New Delhi: The Defense Ministry will focus on enhancing the capability of the armed forces in 2025. This will include many big purchases and contracts. This is coming after a record increase in domestic defense production and exports of weapon systems in 2024. The government is promoting ‘Make in India’. Due to this, more contracts are being signed with Indian vendors. Defense exports have also increased due to global unrest.

Record increase in defense production
Indigenous defense production to increase to record ₹1.26 lakh crore in 2024. This was mainly due to the government’s initiative to promote ‘Make in India’. This includes maximum contracts with Indian vendors. The growth of 16.7% reflects a significant increase in defense exports. This figure reached ₹21,083 crore in the calendar year.

What is the preparation in 2025?
This number is expected to continue to rise as global unrest continues. The Indian defense ecosystem, especially the private sector, is investing heavily in increasing production capacity. In 2024, many companies started investing to set up ammunition manufacturing factories. So far, at least seven new factories are being built in the country. These factories will produce different grades of ammunition. These also include 155mm artillery shells, which are in huge demand across the world.

These factories are being built across the country from Himachal Pradesh to Maharashtra. These will specifically cater to the needs of the European market. The reserves of European countries have decreased due to the Ukraine-Russia war. The 32.5% growth in defense exports in 2024 reflects not only exports of ammunition and explosives, but also exports of larger platforms such as armored infantry fighting vehicles, multiple barrel rocket launchers, missiles and cannons.

Which weapons will be included?
Multiple platforms to be inducted into the armed forces in 2024. There are plans to induct more platforms by early 2025, which will improve combat capability. The second Arihant class nuclear missile submarine was commissioned in 2024. INS Arighat is more advanced and capable than its predecessor. This will enhance India’s second strike capability. The Navy also got the latest Russian-built stealth frigate INS Tushil. Indigenous Light Combat Helicopters were also inducted into service.

The Navy has the lion’s share of the defense capital budget this fiscal year. It was also the lead agency for the procurement of 31 MQ-9B Sky/Sea Guardian High Altitude Long Endurance Remotely Piloted Aircraft Systems (RPAS). This was signed in October 2024.

2025 will be the year of inducting some heavy firepower into the armed forces. This will begin with three warships entering service in January. Prime Minister Narendra Modi is likely to be present on this occasion. It includes the last of the Kalvari class submarines and two other major naval platforms. This year the Air Force will also be delivered the first of the delayed LCA Mk1a fighter aircraft. The army will get long-range Pinak rockets and new artillery systems.

The contracts signed through 2024 included historic deals for the private sector. The largest defense deal ever signed with an Indian private sector organization was signed in March. Larsen & Toubro wins contract worth ₹7,668 crore for supply of Close in Weapon System. This was followed by a ₹7,628 crore deal with the same company for additional K 9 Vajra self-propelled artillery.

The Defense Ministry gave Approval of Requirement (AoN) of ₹4.2 lakh crore to 40 capital acquisition proposals through several meetings of the Defense Acquisition Council (DAC) and Defense Procurement Board (DPB). 94% of this is earmarked for Indian sellers. These approvals begin the procurement process which will begin over the next 2-3 years. The focus in 2025 will be on taking this process forward and introducing a competitive process for selecting new weapon systems.

These will be discussed with France
By early 2025, two major contracts are expected to be signed with France for the acquisition of Rafale marine fighter jets and additional Kalvari class submarines to be built in India. The combined value of these deals could exceed $10 billion.

Despite an agreement with China to resume patrolling and de-escalation of hostilities in eastern Ladakh in 2024, capability enhancement remains a major focus point, given the uncertain geopolitical situation. Although tensions have eased slightly as a result of the Ladakh border agreement, the potential for conflict remains, especially in the eastern region where China has invested heavily in infrastructure development.

In 2025, all eyes will be on a new committee that will work on a plan for capability enhancement, especially for the Air Force. Headed by Defense Secretary RK Singh, the committee is likely to complete a study in four months. The mantra of the Defense Ministry in 2025 is ‘reform’. Defense Minister Rajnath Singh has started the year with a meeting. In this, a roadmap will be prepared which will touch various aspects ranging from procurement policy to jointness, promoting technology transfer and encouraging public-private partnerships.

The industry is expecting a quick procurement process. Promoting technology transfer and public-private partnerships in the defense sector is also high on the agenda. There will be continued focus on domains such as cyber and space, artificial intelligence, machine learning, emerging technologies such as hypersonics and robotics.