India’s defence sector is projected to undergo a transformative expansion by 2047, driven by a nearly fivefold increase in its defence budget—rising from approximately ₹6.8 lakh crore in 2024–25 to ₹31.7 lakh crore by 2047, according to a joint report by the Confederation of Indian Industry (CII) and KPMG.

This surge will position India as the world’s third-largest defence spender, trailing only the United States and China, and reflects the government’s intent to modernise and indigenise the country’s military capabilities. The report, titled “Atmanirbhar, Agrani, and Atulya Bharat 2047,” outlines a comprehensive vision for the sector, emphasizing not only increased spending but also a strategic shift toward greater self-reliance and global competitiveness.

Domestic defence production is expected to rise robustly, from ₹1.6 lakh crore in 2024–25 to ₹8.8 lakh crore by 2047, an increase of over five times. Alongside this, defence exports are projected to leap from ₹30,000 crore to ₹2.8 lakh crore, propelling India into the ranks of leading global defence exporters. 

This export growth is intended to diversify India’s defence industry and enhance its geopolitical influence. Notably, the share of capital expenditure within the defence budget is set to rise from 27% to 40%, reflecting a heightened focus on infrastructure, advanced weaponry, and technology upgrades. Research and development (R&D) spending is also slated to double, from 4% to 8–10% of the defence budget, while the proportion of GDP allocated to defence is expected to increase from 2% to 4–5%.

Despite these ambitious projections, the report highlights several persistent challenges. India’s continued dependence on defence imports for critical technologies remains a significant hurdle to achieving true self-reliance and fostering indigenous innovation.

Regulatory red tape and procedural bottlenecks often slow down procurement and R&D initiatives, while a shortage of skilled manpower hampers the development and management of advanced defence systems. Geopolitical tensions in the region further complicate matters, potentially diverting resources and attention from long-term developmental goals.

The report underscores the necessity of robust public-private partnerships to drive sectoral growth, but notes that the private sector requires more incentives and support to fully participate in defence manufacturing.

Intellectual property rights and technology transfer issues with foreign collaborators are identified as additional obstacles to self-reliance. Addressing these challenges will require strategic planning, increased budget allocations, streamlined procedures, and a culture of innovation and collaboration between the public and private sectors.

While India’s defence sector is poised for unprecedented growth and global prominence by 2047, realizing this vision will depend on overcoming structural, regulatory, and human resource challenges, as well as fostering greater collaboration between government and industry stakeholders. The roadmap outlined by the CII-KPMG report envisions a future where India not only secures its borders but also emerges as a leading force in global defence innovation and exports.

Based On ANI Report