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Defence indigenisation
What it is
The policy drive to source defence equipment domestically, through positive indigenisation lists, procurement preference for Indian vendors and private sector participation alongside DRDO design and state-owned production
Over 150 of roughly 175 ammunition variants used by the Army are now made domestically, with imported share down from about a third to below 10%
Impact on industries
- Converts a defence budget of around Rs 1.7 lakh cr of capex into addressable domestic demand rather than imports
- Energetics and propellants are a natural extension for explosives makers, using shared chemistry, licensing and safety infrastructure
- Export ambition adds a second leg, with a stated target to roughly double defence exports by 2029
- Order flow is lumpy, tender-driven and subject to long qualification and trial cycles before revenue appears
- Competition is intensifying as large industrial groups commit substantial capital to ammunition capacity, so early-mover advantage may erode