According to a joint report by the Confederation of Indian Industry (CII) and KPMG, India’s defense budget is expected to nearly fivefold increase, from roughly ₹6.8 lakh crore in 2024–2025 to ₹31.7 lakh crore by 2047, propelling the country’s defense sector to undergo a transformative expansion.
This increase indicates the government’s intention to modernize and indigenize the nation’s military capabilities and will put India in third place globally in terms of defense spending, behind only the United States and China. The “Atmanirbhar, Agrani, and Atulya Bharat 2047” report presents a thorough plan for the industry, stressing not only higher spending but also a tactical change toward greater independence and worldwide competitiveness.
It is anticipated that domestic defense output will increase significantly, more than five times, from 1.6 lakh crore in 2024–2025 to 8.8 lakh crore in 2047. In addition, it is anticipated that defense exports will increase from ₹30,000 crore to ₹2.8 lakh crore, placing India among the world’s top exporters of defense.
The goal of this export expansion is to increase India’s geopolitical influence and diversify its defense sector. Significantly, the defense budget’s capital expenditure allocation is expected to increase from 27% to 40%, indicating a greater emphasis on infrastructure, cutting-edge weapons, and technological advancements. While the percentage of GDP devoted to defense is anticipated to rise from 2% to 4-5 percent, research and development (R&D) expenditures are also forecast to double, from 4% to 8-10 percent of the defense budget.
Notwithstanding these audacious predictions, the paper identifies a number of enduring difficulties. A major obstacle to attaining full self-reliance and encouraging domestic innovation is India’s ongoing reliance on defense imports for vital technologies.
Procurement and R&D projects are frequently slowed down by regulatory red tape and administrative bottlenecks, while the creation and administration of sophisticated defense systems are hampered by a lack of qualified personnel. The region’s geopolitical tensions make things much more difficult and may draw focus and resources away from long-term economic objectives.
Although the research emphasizes the need for strong public-private partnerships to propel sectors growth, it also points out that further incentives and assistance are needed for the private sector to fully engage in defense production.
Other barriers to self-reliance include concerns about knowledge transfer with overseas partners and intellectual property rights. Strategic planning, more funding, streamlined processes, and a collaborative and innovative culture between the public and private sectors will all be necessary to meet these difficulties.
By 2047, India’s defense industry is expected to reach a level of growth and worldwide relevance never seen before, but achieving this goal would require resolving structural, legal, and human resource issues as well as encouraging increased cooperation between government and industry partners. According to the CII-KPMG report’s roadmap, India will not only safeguard its borders but also become a major player in international defense exports and innovation.
