The ‘Make in India’ initiative launched in September 2014 under PM Narendra Modi caught global attention. It aimed to boost local manufacturing and make India a hub for innovation and production.
One sector seeing major benefits is defense, with more focus on producing advanced equipment and exporting to other countries. This has opened new doors for growth in defense stocks and exports, creating opportunities for businesses and investors.
Let’s get into how this initiative is giving a big push to India’s defense industry and what it means for the future.
Surge in Defense Stocks
The ‘Make in India’ program supports making military equipment within the country, cutting down on imports, and boosting self-reliance. This encourages companies in this field and has made investing in defence stocks attractive.
A prime example of this progress is Bharat Electronics Limited (BEL), a leading state-owned defense electronics company. In Q2 FY25, BEL reported a 15% year-on-year increase in revenue, reaching ₹4,604.9 crore, and a 38.1% surge in net profit to ₹1,091.27 crore.
This financial growth has positively impacted Bharat Electronics share price, reflecting increased investor confidence in India’s defense manufacturing capabilities. As of February 2025, BEL’s share price is around ₹290.
These changes signify the increase of investors in defense stocks as the ‘Make in India’ policy is encouraging defensive production and further promoting the economy.
Increase in Defense Exports
India’s defense exports have seen significant growth in recent years. In the fiscal year 2023-24, exports reached a record ₹21,083 crore, marking a 32.5% increase from the previous year.
In the first quarter of the fiscal year 2024-25, defense exports surged by 78% compared to the same period last year, totaling ₹6,915 crore.
This upward trend reflects India’s growing presence in the global defense market, with the private sector contributing about 60% and public sector undertakings around 40% of the exports.
The initiatives taken by the government in policy reforms as well as in ‘Ease of Doing Business’ have significantly helped in this expansion.
Government Initiatives and Policy Reforms
The Indian government has implemented several initiatives to boost domestic defense manufacturing under the ‘Make in India’ program.
These include increasing foreign direct investment (FDI) limits in the defense sector to 74% through the automatic route and up to 100% with government approval, simplifying procurement procedures, and releasing indigenization lists that restrict imports of certain defense items to encourage local production.
On top of that, the establishment of the Defence Acquisition Procedure (DAP) 2020 has streamlined procurement processes, promoting indigenous design and development.
These reforms aim to reduce dependence on imports, enhance self-reliance, and position India as a global defense manufacturing hub.
Global Geopolitical Dynamics
Global political tensions have increased the need for countries to strengthen their military capabilities, leading to a higher demand for defense equipment.
India has recognized this opportunity and aims to become a significant supplier in the international defense market.
The Indian government has set an ambitious goal to achieve defense exports worth ₹35,000 crore (approximately $4.87 billion) in the coming years, reflecting its commitment to expanding its defense manufacturing and export capacity.
Conclusion
India’s ‘Make in India’ program is creating exciting opportunities in the defense sector. Growing manufacturing capabilities, rising exports, and strong policies are helping the country shine globally. With this, defense stocks are gaining attention, showing the potential of this movement.
