India's defence 'year of reforms' 2025: From indigenisation push to record exports

As 2025 draws to a close, India’s defence sector has undergone one of its most significant transformations in decades, driven by the government’s declaration of the year as the "Year of Reforms". Amid persistent concerns over future border tensions with China and increased security challenges from Pakistan, New Delhi has accelerated efforts to build a more self-reliant, integrated and modern military.

Indigenisation

At the heart of this shift is the push for indigenisation. Positive Indigenisation Lists now cover thousands of items, phasing out imports and mandating domestic production. This has spurred growth in defence manufacturing. Thousands of MSMEs and startups now supply critical components to the armed forces. The Advanced Towed Artillery Gun System (ATAGS), a 155mm howitzer co-developed by DRDO and Bharat Forge, secured approval for 307 guns in early 2025. Enhanced Pinaka rocket launchers now provide extended ranges, while naval projects like INS Vikrant showcase domestic integration of complex platforms involving hundreds of Indian firms. Unmanned systems have seen rapid maturation, with indigenous drones now routinely used for surveillance along the borders.

Manpower & tech

Agnipath scheme, which focuses on a lower average age of troops, enhancing physical resilience and technical skills needed for drone operations and networked systems, has been progressing, while freeing funds previously consumed by pensions, which once accounted for nearly a quarter of the defence budget. Critics argue it risks losing experienced soldiers, but supporters say it prioritises adaptability in today's conflicts. Parallel efforts boost technology. The iDEX programme has backed hundreds of startups, yielding innovations like night-vision devices, surveying drones and AI imagery analysis.

Infrastructure, ammunitions

Since the 2020 Galwan clash, India has transformed its border defences. The Border Roads Organisation has built hundreds of kilometres of all-weather roads, dozens of bridges, and key tunnels, including the operational Atal and Sela, and the nearing-completion Zojila, ensuring year-round access to forward areas. Advanced landing grounds at Daulat Beg Oldi and Nyoma now support heavy aircraft operations at extreme altitudes. New cyber and space agencies coordinate tri-service efforts, backed by dedicated military satellites. Ammunition shortages have eased through private production and a shift to precision-guided munitions.

Procurement eased up

Procurement processes have been streamlined to meet urgent needs. Emergency procurement powers permit acquisitions of up to Rs 300 crore to be executed within a six-month period. Separately, field commanders are authorised to approve immediate purchases up to specified financial limits as per their delegated authority. Frontline units now use SIG716 rifles instead of INSAS, Navy MH-60R Seahawks address anti-submarine warfare ASW gaps, and fast-tracked indigenous systems like Dhanush artillery and Arjun Mk1A tank have moved quickly from trials to induction.

Organisational changes

Organisational changes are progressing, with 2025 designated for advancing Integrated Theatre Commands. The Chief of Defence Staff has gained greater authority to drive jointness, building on models like the Andaman and Nicobar Command. While full rollout faces challenges, consensus among services is being worked on.

Exports

Exports provide external validation. Defence exports reached Rs 21,083 crore in 2023–24, up from about Rs 2,000 crore 5 years ago. Products ranging from artillery to missiles now reach dozens of countries, including the Philippines and Armenia.

Though challenges persist. Procurement timelines for major platforms as fighters can slip, and full integration of theatre commands requires resolving inter-service dynamics. Yet the direction is unmistakable. Forced by geopolitical pressures and bolstered by policy alignment, India’s military is evolving from import dependence towards industrial depth, joint operations and technological edge.