India wants to make its own missiles. Why?

Good news for some defence companies. The government has approved the transfer of all DRDO-developed conventional missile technologies to domestic industry for production in India.

Remember, we had earlier reported that the Defence Research and Development Organisation (DRDO) was inviting private companies to bid for future development and production contracts.

What does it mean: in simple terms, more Indian defence companies could now get missile manufacturing orders, instead of production remaining limited among government-owned players.

The move is also aimed at strengthening India’s domestic manufacturing capabilities, expanding the defence industrial base and creating more opportunities for MSMEs and technology partners.

It could also help reduce import dependence and increase the share of components and systems made within India.

Who could benefit and who could face pressure: Bharat Dynamics could see some not-so-good near term impact. Wider access to DRDO-developed missile technology could bring more domestic players into the segment, increasing competition and potentially putting pressure on margins.

Bharat Electronics, on the other hand, could benefit as it enters the missile manufacturing ecosystem through partnerships with private companies. There is also a broader push to reduce dependence on imports across the armed forces.

According to News18, the Indian Air Force has localised 97% of its frequently used operational fighter spares in recent years. These include batteries, pilot parachutes, fighter tyres, power carts and several other components used in day-to-day flying operations.

The IAF had earlier relied heavily on foreign suppliers for many of these spares. This indigenisation push has reportedly saved ₹582 crore in foreign exchange over the last five years.

Big picture: India’s defence sector has changed significantly over the past decade, driven by higher spending, policy reforms and a stronger push for self-reliance.

The defence budget has risen from ₹2.53 lakh crore in FY14 to ₹7.85 lakh crore in FY27, while indigenous defence production increased from ₹46,429 crore in FY15 to ₹1.78 lakh crore in FY26.