India stands today as the world’s fourth-largest defence spender, according to an HDFC Securities report. The FY27 Union Budget allocated $85 billion for defence, up 15 per cent yoy, representing 15 per cent of the Union Budget.

India’s defence capex has risen steadily in recent years, reflecting a policy shift towards military modernisation. Higher allocations signal sustained investment in aircraft, ships, drones and advanced technologies. Defence exports have expanded sharply over the past decade, rising more than 34-fold since FY14. This growth reflects policy support, a broader product portfolio and increasing participation of private defence manufacturers.

Meanwhile, India’s defence imports declined 9.3 per cent during 2020–24, compared with the previous five years, as import bans and domestic procurement mandates redirect billions towards local manufacturers

Published on March 10, 2026