India’s premier research organisations, ISRO and DRDO, are increasingly transferring perfected technologies to private industry.

The logic is straightforward. Public laboratories excel at research and development but are not designed for mass production.

To scale up India’s space and defence manufacturing, mature systems such as rockets and missiles are being handed over to companies.

This frees scientists to focus on next-generation breakthroughs while simultaneously building a commercially viable domestic industry.

Chinese CCTV cameras have disappeared from the Indian market due to strict cybersecurity rules banning system-on-chips and firmware sourced from land-bordering nations.

This has created opportunities for domestic chip designers and camera makers.

The same principle applies in defence and space. Once a technology is proven, the plan is to commercialise it, and that requires private sector participation. The defence ministry has cleared the transfer of conventional missile systems to Indian companies, while ISRO has been directed under the Indian Space Policy 2023 to step back from manufacturing mastered space systems and hand them to industry.

The SSLV rocket is a prime example. ISRO designed, tested, and flew it successfully, then held a competition. Hindustan Aeronautics Limited won the rights to manufacture and sell it commercially. This reflects the nature of public R&D.

Scientists take ideas through prototypes to maturity, but once proven, the challenge shifts to scaling production reliably and cheaply. India uses Technology Readiness Levels to assess this progress. Scientists are meant to discover the unknown, not supervise production lines.

Once uncertainty disappears, the harder problems become sourcing components, maintaining quality, and reducing costs. That is why ISRO and DRDO transfer technologies.

Scaling requires private partners. India’s space economy, valued at approximately ₹70,000 crore today, is projected to reach ₹3.3–3.7 lakh crore by 2030. ISRO alone cannot achieve this scale. Similarly, a missile design is meaningless in conflict if the country cannot produce enough quickly. Talent is another factor.

Once ISRO masters rocket design, its propulsion scientists prefer working on breakthroughs rather than production. A third reason is building an industry that survives beyond government orders. The hope is that Indian companies will sell rockets, satellites, and imagery commercially.

Defence exports are tightly controlled but have still reached a record ₹38,424 crore in FY2025–26, up nearly 63% year-on-year.

However, inheriting mature technology does not guarantee business success. Capital-heavy industries need steady demand to justify investments. The real measure is whether companies manufacture at scale, win repeat orders, improve products, and find new customers.

When DRDO or ISRO transfers technology, companies receive detailed production instructions, design specifications, material requirements, testing procedures, and quality checklists.

DRDO provides a Transfer of Technology document and scientists guide the first production runs. In space, ISRO develops technology, IN-SPACe regulates access, and NSIL handles commercial agreements.

Companies apply, get assessed, negotiate terms, and receive technical support. Importantly, the government retains intellectual property and controls sensitive uses and exports. Companies receive know-how and rights to manufacture and sell under government terms.

Selection differs between space and defence. In space, HAL won the SSLV rights through open competition. Other bidders included Alpha Design with Agnikul, and Bharat Dynamics with Skyroot. Larger firms brought money and capacity, while Start-Ups contributed specialised expertise.

India had just one registered space Start-Up in 2014; by August 2026, there were around 440, though only a smaller number have IN-SPACe approval. In defence, India already had companies capable of manufacturing DRDO systems.

By December 2025, around 2,000 companies were capable. Some participate even before technologies are ready under DRDO’s Development-cum-Production Partner program. The government aims to integrate large firms and smaller ones into the same supply chain.

Challenges remain. Former ISRO chairman G Madhavan Nair questioned whether companies are ready for critical tasks like final assembly, testing, and launch of rockets such as the PSLV. Expertise built over decades cannot be transferred easily. Few companies can take on entire rocket programs. In the SSLV case, bidders needed at least seven years in business and annual turnover of ₹400 crore to qualify.

This risks concentrating production among a handful of large firms. Defence projects are prone to delays. A 2022 CAG audit found 119 of 178 projects missed deadlines, some by more than five times. Delays can render technologies outdated before deployment. Private manufacturing does not solve this. Factories may sit idle if military orders are delayed.

Defence manufacturers cannot easily rely on exports, as they require government clearance. Their fate depends almost entirely on New Delhi’s procurement calendar.

Neither ISRO nor DRDO is shrinking its ambitions. ISRO is pursuing human spaceflight, a space station by 2035, a crewed Moon mission by 2040, and reusable rockets. DRDO is focusing on hypersonic weapons, directed-energy systems, quantum technology, and artificial intelligence.

Research is increasingly collaborative, involving Start-Ups, universities, and companies from the design stage. India spent decades building institutions to invent indigenous technologies.

Their effectiveness now depends on how quickly and efficiently they are monetised. Space and defence are critical industries, and the path ahead is challenging, but these transfers mark a significant start.

Agencies