Defence industry of India

The defence industry sector of India is a strategically important sector in India. India has one of the world's largest military forces with a strength of over 1.44 million active personnel. It has the world's largest volunteer military of over 5.1 million personnel. The total budget sanctioned for the Indian military for the financial year 2021 is ₹4.78 lakh crore (equivalent to ₹5.6 trillion or US$70 billion in 2023). It has the third largest annual defence budget behind USA (US$732 b) and China (US$261 b). It is the second largest defence importer behind Saudi Arabia making up 9.2% of global arms import. India has a domestic defence industry of which 60% is government owned. The public sector includes NTRO, CSIR, PRL, DRDO and its 50 labs, 4 defence shipyards, 12 defence PSUs. India has a new defence procurement, acquisition and manufacturing policy to reduce imports and enhance domestic manufacturing.

"Defence Production Policy of 2018" (DPrP-2018) has a goal of becoming among the top 5 global producers of the aerospace and defence manufacturing with annual export target of US$5 billion by 2025. 12% of worldwide arms exports (by value) reach India. India domestically produces only 70% to 75% of defence products it uses, and the rest are imported. India's defence exports were ₹4,682 crore (US$0.66 billion) in 2017–2018 and ₹10,500 crore (US$1.47 billion) in 2018–2019, of 2018–2019 exports India's 8 Defence Public Sector Undertakings (DPSU) and 41 Ordnance Factories (OF) contributed ₹800 crore (7.6% of total defence exports). During 2014–2018 India was the world's second largest defence importer.