The Defence Research and Development Organisation (DRDO) is spearheading a major policy shift aimed at reshaping how India funds its defence research ecosystem.

In a decisive move, DRDO Chairman Samir V Kamat has called for the inclusion of a new chapter in the General Financial Rules (GFR) to grant greater flexibility and autonomy in R&D financing for start-ups and private industries.

Speaking at the Delhi Defence Dialogue 2025, Kamat underlined that the time has come to treat defence research as a strategic investment rather than a routine expenditure.

Drawing parallels with the United States’ Defence Advanced Research Projects Agency (DARPA), he argued that a similar autonomous framework could unlock innovation and risk-taking in India’s R&D sector.

According to Kamat, such autonomy would encourage bold experimentation that can lead to disruptive technological breakthroughs.

Currently, R&D expenditures under government purview are subject to stringent accountability norms, often leading to a conservative approach to innovation. Kamat pointed out that the existing financial framework, while ensuring accountability, discourages projects with uncertain outcomes due to potential scrutiny from the Comptroller and Auditor General (CAG) and parliamentary oversight.

The proposed GFR amendment, he explained, would balance accountability with innovation by creating a funding mechanism that accepts calculated risks as part of progress.

Kamat outlined that this reform aligns with the national objective of strengthening indigenous capabilities under the Atmanirbhar Bharat initiative. He noted that start-ups and private entities in defence technology require predictable and flexible funding streams to scale innovation from prototype to production.

Enhanced autonomy in R&D funding would empower these organisations to explore cutting-edge technologies such as quantum communication, advanced materials, and AI-driven combat systems.

Supporting Kamat’s view, Chief of the Army Staff General Upendra Dwivedi emphasised the dramatic evolution of modern warfare. He observed that technological fluidity has democratised the battlefield, enabling even smaller nations and non-state actors to leverage sophisticated systems.

Dwivedi cited real-time examples from the Russia–Ukraine conflict, where AI algorithms, drones, and cyber capabilities have fundamentally altered tactical and strategic operations.

He asserted that the Indian armed forces must adapt to this shifting paradigm through close collaboration with industry, academia, and start-ups. “Democratisation of technology, geographic diffusion, and demographic utilisation,” he stated, are now the defining principles of contemporary military strategy.

By leveraging a more inclusive and agile innovation ecosystem, India can effectively prepare for multi-domain operations of the future.

The Delhi Defence Dialogue 2025, hosted in New Delhi, served as a convergence point for policymakers, military leaders, and industry innovators. Discussions underscored the pressing need for reform in R&D funding models, acknowledging that agility in financial governance is critical to sustaining technological leadership. The DRDO’s proposal for a revised GFR framework represents a foundational step toward this transformation.

If implemented, the policy could establish a DARPA-style environment where strategic risks lead to long-term gains. This model would enable a cycle of continuous innovation, supporting not only defence modernisation but also India’s broader ambitions in advanced manufacturing and dual-use technology development.

Agencies