Private Firms Enter Defence

How private companies and startups are entering India's defence sector, from artillery to drones, and the barriers they face.

Until recently, private firms played a small role in Indian defence. That is changing.

Big private players

Tata Advanced Systems: aircraft parts, and the C-295 transport aircraft assembly line with Airbus in Vadodara, inaugurated in 2024.
Larsen & Toubro: artillery guns and ships.
Bharat Forge (Kalyani Group): artillery.
Adani Defence, Mahindra and others.

Startups

Startups work on drones, surveillance, robotics and software. The iDEX programme (2018) funds innovation challenges for startups.

Barriers

Long procurement cycles of years.
Uncertain orders, making investment risky.
Testing and certification hurdles.
Competition with PSUs that have established relationships.

Why private entry matters

Competition can reduce costs and speed up delivery.
Innovation, especially in new technologies.
Exports from agile firms.

The drone startup

A startup designs a surveillance drone and wins an iDEX challenge. After trials, the army orders a batch, giving the startup its first large contract.

Thinking defence is only for government companies

Private firms and startups are increasingly important.

Key takeaways

Private firms like Tata, L&T and Bharat Forge are expanding in defence.
The C-295 assembly line in Vadodara opened in 2024.
iDEX supports defence startups.
Long procurement cycles and uncertain orders are barriers.