Hindustan Aeronautics Limited (HAL), India’s main defence aerospace industry, has announced a significant increase in R&D spending, with the goal of raising its innovative capabilities to global norms.
The corporation released a thorough new R&D manual, signaling a change toward greater flexibility, speed, risk management, and autonomy in project allocation. Rajnath Singh, the Defence Minister, launched the manual during the annual review of 16 Defence Public Sector Undertakings (DPSUs) in New Delhi.
HAL currently invests over ₹2,500 crore yearly on R&D, accounting for approximately 6% of its revenues. The new manual supports a proposal to expand expenditure to ₹17,000 crore in the next years.
This matches HAL’s ambitions with those of global aerospace leaders, who usually invest 7–8% of their revenues in innovation. HAL’s R&D spending increased from 6% of revenues in FY20 to 9.5% in FY24, enabling new platform development and producing over 1,000 intellectual property rights.
The manual creates a more agile R&D environment by digitizing processes, encouraging intellectual property creation, and strengthening collaboration with Indian academic institutions. Importantly, it enables HAL to launch and fund projects proactively, as opposed to previous procedures that relied on waiting for client interest, hence accelerating indigenous innovation.
This proposal comes as India’s defense Minister declares 2025 the “Year of Reforms,” with an emphasis on improving technology development by defense PSUs, increasing exports, and promoting indigenisation.
Over the past decade, the 16 defense PSUs have invested ₹30,952 crore in R&D, with HAL, Bharat Electronics Limited, and Bharat Dynamics Limited leading the way. Over the next five years, these entities will invest ₹32,766 crore in R&D, double their current rate.
HAL was granted Maharatna status in October 2024, which gives it additional autonomy and financial capacity. It presently has an order book of almost 1,90,000 crores, offering solid revenue visibility as it attempts to expand India’s aerospace and defense production capabilities on a worldwide scale.
HAL’s new ₹17,000 crore R&D investment plan and cutting-edge manual mark a transformative phase, aiming to double innovation output, comply with worldwide norms, and strengthen India’s standing as a key global defense aerospace player.
This would allow for speedier domestic design cycles, more robust intellectual property generation, and stronger academia-industry links, ultimately strengthening India’s strategic autonomy in defense technology.
