In recent years, the Indian government has implemented a series of transformative initiatives aimed at bolstering the country's defence production capabilities and achieving self-reliance. These measures are designed to attract investment, enhance domestic manufacturing, and streamline procurement processes. 

From liberalising foreign direct investment (FDI) limits to prioritising indigenous production, these initiatives reflect a robust commitment to strengthening India's defence industrial base. The following points outline the key government initiatives that have been pivotal in driving growth and innovation in the defence sector.

 The Foreign Direct Investment (FDI) limit in the defence sector was raised in 2020 to 74% through the Automatic Route for companies seeking new defence industrial licenses and up to 100% through the Government Route for those likely to result in access to modern technology. As of February 9, 2024, ₹5,077 crore worth of FDI has been reported by companies operating in the defence sector.

The allocation for the Ministry of Defence for the financial year 2024-25 is ₹6,21,940.85 crore, as part of the “Demand for Grant” presented in Parliament during the ongoing Budget Session.

Procurement: Emphasis is placed on procuring capital items from domestic sources under the Defence Acquisition Procedure (DAP)-2020.

Notification of five ‘Positive Indigenisation Lists’ totalling 509 items of services and five lists of 5,012 items from Defence Public Sector Undertakings (DPSUs), with an embargo on imports beyond specified timelines.

Streamlining the industrial licensing process with a longer validity period.

The Innovations for Defence Excellence (iDEX) scheme was launched to involve start-ups and Micro, Small, and Medium Enterprises (MSMEs) in defence innovation.

Implementation of the Public Procurement (Preference to Make in India) Order 2017 to support domestic manufacturers.

Launch of the Self-Reliant Initiatives through Joint Action (SRIJAN) portal to facilitate indigenisation by Indian industry, including MSMEs.

Establishment of two Defence Industrial Corridors, one each in Uttar Pradesh and Tamil Nadu, to promote defence manufacturing.

Defence Research & Development (R&D) has been opened up for industry and start-ups to foster innovation and collaboration.

Out of the total allocation of ₹1,40,691.24 crore under the Capital Acquisition (Modernisation) Segment, ₹1,05,518.43 crore (75%) has been earmarked for domestic procurement in the Budget Estimates for 2024-25.