Modernizing India's Defence

India's strategic environment is undergoing rapid transformation. With evolving threats ranging from conventional military challenges to cyber warfare and space-based conflicts, the need for a modernized defense apparatus has never been more pressing. The recent declaration of 2025 as the "Year of Reforms" by the Ministry of Defence underscores the urgency to revamp India's military capabilities to address both current and emerging security challenges .

Two-front threat and expanding regional tensions

• China and Pakistan Axis: India's military must be equipped to tackle simultaneous threats from both the eastern and western borders. China's aggressive posturing in Arunachal Pradesh and infrastructure buildup across the LAC demand an agile and technologically superior response.
• Border Skirmishes and Protracted Deployments: From the Siachen Glacier to Eastern Ladakh, India has thousands of troops deployed in extreme terrain. Static deployments with aging weaponry pose both strategic and logistical challenges.

Technological Disruption in Modern Warfare

• Drones and AI in Warfare: Conflicts in Ukraine, Gaza, and Armenia-Azerbaijan have shown how AI, swarming drones, and loitering munitions are game-changers. India’s existing air defence and surveillance grids are not yet optimally tuned for such threats.
• Cyber and Electronic Warfare: China’s capabilities in cyber intrusion and electronic jamming are advanced. India’s defence systems need better encryption, AI-based countermeasures, and hardened networks.

Outdated Equipment and Operational Gaps

• Combat Aircraft Shortage: India ideally needs 42 squadrons for a two-front war but currently operates only 31–33. Several MiG-21s, Jaguars, and Mirages are nearing the end of service.
• Archaic Artillery and Air Defence Systems: Many regiments still use Bofors-era guns or outdated SAM systems. While new platforms like M777 and Akash have arrived, full-scale modernisation is pending.

India's Global Aspirations and Regional Deterrence

• Maritime Influence in the Indo-Pacific: As China expands its naval footprint, India must project credible maritime power via aircraft carriers, nuclear submarines, and surveillance capabilities.
• Strategic Deterrence: A credible second-strike nuclear capability, satellite-based ISR (intelligence-surveillance-reconnaissance), and hypersonic missile tech are essential for deterrence against peer adversaries.

Geopolitical Flux and Shifting Alliances

• China-US Rivalry & QUAD Alignment: India must be militarily capable to assert itself within groupings like QUAD, not merely as a diplomatic player but a defence pillar.
• Weaponisation of Supply Chains: India has witnessed how overdependence on foreign suppliers (e.g., Russian spare parts) can compromise readiness during geopolitical upheavals.

Defence Self-Reliance as a Strategic and Economic Necessity

• Import Dependency: India is the world’s largest arms importer. Nearly 60–70% of critical platforms or components are sourced externally.
• Cost-Efficiency and Job Creation: Indigenous defence manufacturing offers long-term cost savings and supports ‘Make in India’ by creating a tech-based industrial base and high-skill jobs.

Force Structure: Imbalanced and Overburdened

• Manpower-Heavy Composition: India’s military is one of the largest in the world in terms of personnel, but the force remains heavily reliant on foot soldiers. Over 55% of the defence budget is consumed by salaries and pensions, reducing capital expenditure.
• Lack of Jointness: The Army, Navy, and Air Force often function in silos. Despite the creation of the Chief of Defence Staff (CDS) and Department of Military Affairs (DMA), integrated operations and procurement are still limited.
• Command Structure Lagging Behind: The plan to reorganize the armed forces into Theatre Commands remains delayed. Bureaucratic resistance and inter-service disagreements continue to stall this crucial reform.

R&D and Indigenous Technology Landscape

• DRDO Achievements and Limits: While DRDO has delivered successful platforms like the Akash missile, LCA Tejas, and Pinaka rocket system, timelines often extend well beyond schedules (e.g., Kaveri jet engine project failure).
• Limited Private R&D Ecosystem: The involvement of private players in core R&D remains restricted due to regulatory red tape, lack of tech transfer from DRDO, and inconsistent project funding.
• Dependence on Foreign Tech for Key Systems: From aero-engine tech to advanced radar and night vision systems, Indian forces still rely heavily on foreign vendors, especially from Russia, Israel, France, and the US.

Budgetary Allocation: Growing Numbers, Shrinking Margins

• Top-Line Budget Growth: In FY 2024–25, India allocated ₹6.21 lakh crore ($75 billion) for defence — a 10% increase from the previous year. However, capital outlay (used for new equipment) was only around ₹1.72 lakh crore (~28%).
• Pension & Revenue Expenditure Dominance: Nearly 55% of the total budget is locked in recurring expenses (₹1.4 lakh crore on pensions alone), leaving limited room for platform upgrades and infrastructure.
• Lack of Long-Term Budgeting: India does not yet follow a 10–15 year defence planning cycle backed by firm financial commitments. Modernisation plans often falter due to mid-term reallocations or shortfall in annual capital budgets.

Industrial Base: Fragmented and Import-Dependent

• Ordnance Factory Board (OFB) Corporatisation: The 2021 move to convert OFB into 7 DPSUs was a step toward efficiency, but these entities are still adjusting to market competition and independent operation.
• Private Participation Still Nascent: Companies like L&T, Tata Advanced Systems, and Bharat Forge are gaining ground, but barriers like opaque procurement rules and preference to DPSUs remain.
• Offsets and FDI Policy: India’s offset policies (requiring foreign vendors to invest in India) have seen limited success. The 74% automatic FDI route in defence hasn’t yet attracted significant high-tech inflow.

Logistics, Infrastructure & Border Preparedness

• Border Infrastructure Gaps: Despite progress under the Border Roads Organisation (BRO), several areas in Arunachal, Ladakh, and Sikkim lack reliable connectivity, impeding troop movement and logistics.
• Ammunition Stockpiles: The CAG has repeatedly flagged inadequate war wastage reserves (WWR) — in some cases, enough for just 10 days of intense combat, rather than the required 20–40 days.
• Base and Depot Modernisation: Many airbases, naval docks, and ammunition depots are over 30 years old, lacking modern safety, storage, and surveillance infrastructure.

Strategic Reforms in Organisation and Governance

• Creation of the Chief of Defence Staff (CDS): In 2019, India appointed its first CDS to integrate tri-services command and streamline procurement. The Department of Military Affairs (DMA) under CDS is tasked with joint planning, reducing redundancies, and overseeing theatre command rollout.
• Agni Path Scheme (2022): Introduced to modernise the army’s age profile and reduce pension burdens, this short-service scheme seeks to create a leaner, younger, more agile fighting force.
• Corporatisation of Ordnance Factories: The OFB was split into 7 Defence Public Sector Units (DPSUs) to improve accountability, efficiency, and competitiveness in production.

Push for Atmanirbhar Bharat in Defence

• Defence Acquisition Procedure (DAP) 2020: The updated policy gives preference to ‘Make in India’ categories, including ‘Buy (Indian-IDDM)’ and ‘Strategic Partnership’ models for high-value platforms like fighter jets and submarines.
• Positive Indigenisation Lists: MoD has issued four such lists, banning imports of over 500 defence items (tanks, UAVs, missiles, sensors) within specific timelines to boost domestic production.
• Rising Share of Domestic Procurement: As per MoD data (2023), 68% of the total capital procurement budget has been earmarked for Indian vendors — a record figure.

Revamp in Defence R&D and Innovation Ecosystem

• DRDO Reform & Focus Areas: DRDO has been encouraged to outsource non-core production and focus on next-gen techs like hypersonic missiles, swarm drones, directed energy weapons, and quantum sensors.
• Innovations for Defence Excellence (iDEX): Launched in 2018, iDEX connects startups and MSMEs with defence needs. Over 300 startups have been funded for projects including anti-drone tech, lightweight armor, and AI-based surveillance.
• Technology Development Fund (TDF): Offers up to ₹10 crore per project for MSMEs and academia to develop indigenous defence solutions.

Modernisation of Equipment and Platform Induction

• Land Systems: Upgrades of T-90 and Arjun tanks, induction of K9 Vajra-T self-propelled howitzers, and new SIG716 assault rifles for infantry mark the modernisation drive.
• Air Systems: Tejas Mk1A, Rafale fighters, Apache attack helicopters, and S-400 air defence systems are being inducted. The AMCA (Advanced Medium Combat Aircraft) and CATS Warrior drone-loyal wingman program are in development.
• Naval Expansion: INS Vikrant (India’s first indigenous aircraft carrier) was commissioned in 2022. Projects for nuclear submarines (SSBN) and new destroyers (Project 15B) are underway.

Infrastructure & Surveillance Capabilities

• Border Infrastructure Acceleration: BRO’s pace has doubled in recent years, with strategic roads, bridges, and tunnels (e.g., Atal Tunnel, Sela Tunnel) improving border troop mobility.
• ISRO–Defence Collaborations: Satellites like EMISAT and RISAT enable real-time military surveillance. Defence Space Agency is now coordinating satellite-based assets and counter-space warfare strategy.
• Coastal Security Upgrades: Post-26/11 reforms include a three-tier security mechanism, marine police stations, radar chains, and a Maritime Domain Awareness system along India’s vast coastline.

Defence Exports and Global Footprint Expansion

• Export Surge: India's defence exports rose from ₹1,500 crore in 2016–17 to over ₹21,000 crore in 2023–24. Products exported include BrahMos missiles, Pinaka rocket systems, LCA parts, and naval patrol vessels.
• Export Authorisation Simplification: The MoD has streamlined export licensing and collaborated with friendly nations like Armenia, Philippines, and Vietnam for defence equipment sales.

United States

• Defense Agreements: Frameworks like COMCASA and BECA facilitate enhanced interoperability and intelligence sharing.
• Joint Development: Collaborative projects in areas such as drone technology and jet engine production are underway .

Other Strategic Partners

• France: The acquisition of Rafale jets and potential collaborations in submarine technology.
• Israel: Joint ventures in missile defense systems and electronic warfare capabilities.
• Japan and Vietnam: Expanding defense ties across various domains, including land, sea, and air 

Procurement Delays and Bureaucratic Gridlock

• Cumbersome Acquisition Process: Even with DAP 2020, the average defence procurement cycle in India spans 5–10 years, involving lengthy trials, field evaluations, and file movements across multiple ministries.
• Frequent Changes in Qualitative Requirements (QRs): Services often revise technical specifications midway, forcing vendors to rework bids and retest systems, leading to further delays.
• Audit Paralysis and Fear of Scrutiny: Post-Bofors, procurement officers remain risk-averse, fearing CAG or CBI investigations. This creates a culture of inaction and excessive paperwork.

Overreliance on Imports and Technology Denial

• Foreign Dependency Across Critical Sectors: Over 60% of India’s defence equipment is of foreign origin — from aircraft engines and submarines to radar and electronic warfare suites.
• Technology Denial Regimes: India still faces export restrictions on core technologies like jet engines, advanced sensors, submarine AIP modules, and semiconductor-grade chips.
• High Cost of Foreign Deals: Big-ticket imports (e.g., Rafale, S-400) are expensive and include maintenance contracts that drain defence capital over time.

Weak Defence R&D and Indigenous IP Base

• Slow DRDO Delivery Timelines: Many indigenous projects (e.g., LCA Tejas, Arjun Tank, Nag ATGM) were delayed by decades, forcing the services to seek imports or emergency purchases.
• Low Private Sector R&D Investment: Defence startups and MSMEs struggle with unstable funding, limited access to user feedback, and lack of long-term procurement commitments from the Services.
• Insufficient Academia–Industry–Military Collaboration: Unlike the US DARPA or Israeli defence ecosystem, India lacks a strong triad of innovation that connects military needs with scientific institutions and agile startups.

Human Resource Challenges and Training Gaps

• Ageing Officer Cadre: Many middle-rank officers lack exposure to modern warfare concepts like cyber ops, AI warfare, or drone swarms. Continuous training in such domains is limited.
• Agni Path Scheme Uncertainties: While cost-effective, the scheme has triggered concerns about regimental identity, combat readiness, and post-retirement employment — potentially impacting morale and long-term cohesion.
• Vacancies and Overstretch: The Army alone faces over 1.5 lakh vacancies. Paramilitary forces like ITBP and BSF are often used in military-like roles without proper integration or training.

Budgetary Constraints and Skewed Allocation

• Pension Bill Eating into CapEx: Over ₹1.4 lakh crore annually is spent on pensions, leaving limited fiscal space for capital procurement and R&D.
• Unspent Capital Funds: MoD has historically underutilised its capital budget due to procedural delays — in some years, up to ₹15,000 crore remained unused.
• No Long-Term Funding Assurance: Lack of a guaranteed 10–15 year defence capital allocation plan means long-gestation projects face mid-way budgetary cuts or re-evaluation.

Coordination Deficits and Inter-Service Rivalry

• Siloed Service Planning: Army, Navy, and Air Force often procure independently, leading to overlap (e.g., all three developing UAV capabilities separately) and inefficient resource use.
• Theatre Command Resistance: Disagreements on leadership hierarchy, domain dominance, and resource-sharing have delayed joint command structures — essential for integrated warfare.
• Civil-Military Disconnect: Strategic planners in MoD often lack military experience, leading to misalignment between policy intentions and battlefield realities.

Implementing Shekatkar Committee Recommendations (2016)

• Recommendation: Rationalise manpower across services, reduce non-core posts, and reinvest savings into capital acquisition.
• Progress: MoD accepted 99 of the 188 recommendations, but critical reforms like reducing the Army’s static formations and trimming logistics units remain incomplete.
• Action Needed:
  • Implement full cadre review.
  • Reorganise military engineering and logistics corps to reduce duplication.
  • Privatise or outsource non-combat functions like vehicle maintenance, construction, and supplies.

Enabling True Jointness Through Integrated Theatre Commands

• Current Issue: Separate commands create coordination delays and redundancy in resource deployment.
• Recommendation: Create integrated theatre commands (Western, Eastern, Maritime, Air Defence, Logistics) under a single theatre commander.
• Challenges:
  • Turf wars among services.
  • Lack of clarity on command chain.
• Action Needed:
  • Begin with functional theatre commands (like Maritime or Air Defence).
  • Pilot joint staffing and command training to reduce resistance.

Reforming DRDO and Defence PSUs

• Issue: DRDO suffers from delayed projects, lack of accountability, and limited user involvement.
• Kargil Review Committee (1999): Called for user-driven R&D, separation of design and production, and greater private sector involvement.
• Action Needed:
  • Define KPIs for DRDO labs; incentivise timely delivery.
  • Mandate tri-service participation in design and testing.
  • Encourage PPPs in R&D via models like the US DARPA or Israel’s SIBAT.

Establishing a Chief of Defence Staff with Full Authority

• CDS Role Today: Coordinator without command authority over services.
• Naresh Chandra Task Force (2012): Recommended a Permanent Chairman of Chiefs of Staff Committee (PC-CoSC) with operational authority and budgetary control.
• Action Needed:
  • Empower CDS with budget oversight and tri-service integration.
  • Ensure the DMA leads doctrinal reforms, not just administrative coordination.

Modernising India’s defence is not merely about acquiring new hardware—it is about reshaping doctrines, upgrading mindsets, indigenising technology, and aligning military readiness with future threats. In a world marked by hybrid wars, cyber attacks, and rapidly shifting power balances, India cannot afford to delay critical reforms. While strides have been made—through Atmanirbhar Bharat, strategic partnerships, and organisational changes—the pace and depth of transformation must accelerate. India’s national security architecture must evolve to not only defend borders, but to project stability, deter aggression, and secure its rightful place as a leading global power.