India's defence sector has ordering opportunities for $138 bn over 10 years

India’s defence sector holds a lucrative ordering opportunity of USD 138 billion over FY24-32 amid the escalating demand for defence equipment, technologies, and services, offering significant prospects for companies engaged in defence production and technology development, according to a report titled ‘India Defence’ by Nomura.

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The report highlights that India’s defence capital expenditure is poised to surge to 37 per cent of the total budget by FY30, marking a substantial increase from the projected 29 percent in FY25. This equates to a cumulative capital outlay of Rs 15.5 trillion over FY2430, indicating substantial growth compared to previous periods.

“India’s government is actively supporting the defence sector through favourable policy reforms, incentives, and initiatives to promote indigenous manufacturing and technology development. We expect the share of defence capital outlay to increase to 37% of total defence budget in FY30 (FY24RE: 26 per cent). This implies cumulative capital outlay of USD186bn over FY24-30 (vs cumulative FY18-24F: USD93bn),” said the report.

The report attributes this growth to increasing defence budgets, modernization efforts, and the government’s focus on indigenous manufacturing under initiatives like “Make in India.”