India’s annual defence manufacturing output has reached Rs1.78tn ($18.84bn) in the financial year 2025-26, according to a statement issued by the Ministry of Defence (MoD).
This marks a 15.6% increase from the previous year’s Rs1.54tn and amounts to a 110% rise since 2020-21, when output was Rs846.43bn.
Over the past decade, indigenous defence production has also expanded nearly fourfold, up from Rs437.46bn in 2013-14.
Organisations in the public sector, including Defence Public Sector Undertakings and other state-owned companies, contributed about 76% of the total output during the last financial year.
Meanwhile, the private sector share grew to 24%, its highest level so far, amounting to approximately Rs420bn in 2025-26 compared to 22% in the previous year.
The Ministry also reported that growth in domestic production was accompanied by a record in defence exports, which reached Rs384.24bn in 2025-26.
Officials attributed these trends to ongoing government policies aimed at increasing self-reliance in the sector, particularly under the Aatmanirbhar Bharat programme.
In response to this growth, India’s Defence Minister Rajnath Singh said: “The remarkable rise in India’s defence production in recent years is the result of the collective efforts of the Department of Defence Production and all other stakeholders.
“This upward trajectory is a clear indicator of the country’s expanding defence industrial base. With sustained policy support, several new initiatives, increased private sector participation, and growing export capabilities, the defence production sector is poised for continued acceleration in the years ahead.”
In February this year, the government allocated Rs7.85tn (Rs7,850bn) to the MoD in the Union Budget for the 2026–27 financial year.
This figure, announced on 1 February 2026, reflects a 15.19% increase over the previous year and accounts for 14.67% of the national budget, representing the highest allocation among all ministries.
