Defence PSUs lead India’s Defence production at ₹1.51 Lakh crore: Rajnath Singh
Union Defence Minister Rajnath Singh, during an Annual Performance review meeting after the inauguration of Defence PSU Bhavan, a state-of-the-art central facility at the World Trade Centre, in New Delhi, on Monday
| Photo Credit:
ANI
India’s defence production has reached an all-time high of ₹1.51 lakh crore in FY25, with Defence Public Sector Undertakings (DPSUs) contributing a substantial 71.6 per cent, Defence Minister Rajnath Singh announced on Monday after reviewing the performance of 16 State-owned defence manufacturing units.
The review comes close on the heels of the revised Defence Procurement Manual (DPM) 2025, which came into effect on November 1, ushering in a more competitive environment by offering a level playing field to both government and private industry.
The new framework eliminates the requirement for a No Objection Certificate (NOC) from State-owned entities before procurement from other sources — a move expected to intensify competition for the nine major DPSUs, including Hindustan Aeronautics Ltd (HAL) and Bharat Electronics Ltd (BEL), and the seven new companies carved out of the Ordnance Factory Board (OFB) in 2021.
Private surge
While DPSUs continue to dominate defence production, the private sector’s contribution has been steadily rising, increasing from 21 per cent in FY24 to 23 per cent in FY25. The share of DPSUs and other PSUs, which stood at about 77 per cent as of August 2024, has been gradually narrowing, signalling a shift toward greater private participation in the indigenous defence ecosystem.
The MoD has been hand-holding the government firms, given that it provided ₹5,757 crore to them for modernisation and another ₹5,000 crore as an emergency authorisation fund between 2021-22 and 2024-25. Financial assistance to the new DPSUs will be provided until FY27.
Exports up
During the review, Rajnath Singh also highlighted that defence exports have touched ₹6,695 crore, underscoring growing international confidence in India’s indigenous platforms.
“All our 16 DPSUs are serving as strong pillars of the country’s self-reliance. Their excellent performance in operations like Operation Sindoor testifies to the reliability and capability of our indigenous platforms.”
As part of the event, three major MoUs were signed to foster collaboration and reduce import dependence.
Hindustan Aeronautics Ltd (HAL) and Bharat Dynamics Ltd (BDL) signed separate agreements with Yantra India Ltd (YIL) to support its modernisation and set up a 10,000-tonne Forging Press facility — a key step towards domestic production of aluminium alloys used in defence and aerospace applications.
HAL will provide an interest-free advance of ₹435 crore to YIL, while BDL has committed a sustained workload of 3,000 tonnes over ten years.
A third MoU was signed with MIDHANI for establishing a Metal Bank to ensure an uninterrupted supply of critical raw materials for national defence projects.
New Initiatives
The Defence Minister also commended Hindustan Shipyard Ltd (HSL), Armoured Vehicles Nigam Ltd (AVNL), India Optel Ltd (IOL) and Munitions India Ltd (MIL) for attaining Miniratna status, calling it “a reflection of their growing efficiency, autonomy and contribution to the defence sector.”
In a major push towards innovation and sustainability, Singh launched several initiatives to strengthen R&D and promote green manufacturing within the defence ecosystem.
Published on November 10, 2025
