India’s defence manufacturing sector is poised for a dramatic transformation over the next two decades. According to a new study released by the Confederation of Indian Industry (CII) in collaboration with KPMG India, the country’s defence production could see a sixfold increase, reaching ₹8.8 lakh crore by the year 2047, compared to the projected ₹1.46 lakh crore for 2024-25.
This ambitious growth trajectory aligns with India’s broader vision of becoming a self-reliant and globally influential power by its centenary of independence. The report, titled “Atmanirbhar, Agrani, and Atulya Bharat 2047,” outlines a roadmap for India’s defence sector to evolve into a globally competitive and innovation-driven industry.
The report estimates that India’s annual defence budget will grow nearly fivefold by 2047, touching ₹31.7 lakh crore — a significant rise from the current allocation of ₹6.81 lakh crore for FY 2025-26. Alongside production, defence exports are also expected to scale significantly, jumping nearly 12 times to ₹2.8 lakh crore from ₹24,000 crore in the same base year.
As per the projection, defence spending would represent about 4.5% of the GDP in 2047, compared to the current 2%, indicating a more prominent role for the sector in the national economy.
A crucial element of the strategy involves a stronger push for innovation. The share of defence budget earmarked for research and development (R&D) is expected to rise from 4% at present to between 8% and 10%. This enhanced investment is intended to support the development of advanced technologies and home-grown military systems.
The report emphasizes that for India to become a truly independent defence manufacturing hub, fostering domestic innovation through consistent R&D funding and industry-academia-government collaboration is essential.
Key Challenges and Strategic Priorities
While the goals are ambitious, the report acknowledges several hurdles. Issues around technology transfer, intellectual property rights, and limited private sector participation continue to hamper progress. The report stresses the need for targeted reforms and incentives to attract and retain private players in the defence ecosystem.
Among the recommendations are:
Promoting public-private partnerships to bridge capability gaps
Addressing regulatory bottlenecks
Developing clear, long-term procurement plans
Creating a robust policy framework to facilitate indigenization
Strategic Milestones on the Road to 2047
The roadmap sets out three major strategic milestones to guide India’s defence aspirations:
By 2032: Achieve significant levels of self-reliance by indigenizing key technologies and systems, and reducing dependency on foreign imports.
By 2038: Position India among the top five defence exporters globally by meeting international quality benchmarks and aggressively expanding its global footprint through strategic partnerships.
By 2045: Establish India as a global leader in defence innovation, especially in niche and next-generation technologies such as AI, quantum computing, and autonomous systems.
The report makes it clear that India’s vision of becoming a defence manufacturing giant by 2047 is within reach — but only with determined execution. Strategic investments, collaborative ecosystems, and policy reforms will be key to unlocking this potential. As India looks ahead to its centenary year, a strong, self-reliant defence sector could become a pillar of its global standing and economic strength.
