India Pushes Self-Reliance in Defence: $46 Billion in Capital Approvals During 2025

The Ministry of Defence (MoD) closed 2025 with major reform milestones, including ₹3.84 lakh crore worth of capital acquisition approvals and ₹1.82 lakh crore in signed contracts, marking a decisive push toward indigenisation, jointness, and modernization of India’s armed forces.

Key Achievements in the "Year of Reforms 2025"

• Capital Acquisition Push
  • Defence Acquisition Council (DAC) approved proposals worth ₹3.84 lakh crore since January 2025.
  • MoD signed contracts worth ₹1.82 lakh crore by December 2025, achieving 80% utilization of the capital acquisition budget.
• Indigenisation & Private Sector Role
  • Strong emphasis on self-reliance in defence manufacturing.
  • Increased participation of private industry to secure supply chains and reduce import dependency.
• Operational Readiness
  • Reforms were accelerated after Operation Sindoor and the Pahalgam terror attack, which highlighted gaps in preparedness.
  • India conducted joint military exercises with the US, France, Russia, and others to strengthen interoperability.
• Policy & Structural Changes
  • Review and revision of the Defence Acquisition Procedure (DAP) 2020.
  • Encouragement of foreign direct investment (FDI) in defence.
  • Rationalisation of restricted distance norms near defence establishments.
• Welfare & Governance
  • Improved welfare delivery mechanisms for personnel.
  • Whole-of-government approach to build a modern, integrated, and future-ready defence ecosystem.

Snapshot of Progress

Reform Area	Key Progress in 2025	Strategic Impact
Capital Acquisition	₹3.84 lakh crore approved; ₹1.82 lakh crore signed	Boosts modernization & readiness
Indigenisation	Private sector role expanded	Strengthens self-reliance, supply chain security
Policy Framework	DAP 2020 revised, FDI encouraged	Streamlined procurement & global partnerships
Operational Preparedness	Joint exercises, post-Operation Sindoor reforms	Enhanced combat readiness & interoperability
Welfare & Governance	Improved delivery mechanisms	Better morale & efficiency

Challenges & Trade-offs

• Budgetary Pressure: High capital expenditure may strain fiscal priorities.
• Technology Gaps: Despite indigenisation, advanced systems still rely on imports.
• Geopolitical Risks: Reforms were partly reactive to cross-border tensions, raising sustainability questions.
• Private Sector Integration: Balancing speed with quality assurance in defence manufacturing remains complex.

Strategic Outlook

The Year of Reforms 2025 positioned India’s defence sector on a trajectory toward greater self-reliance, jointness, and modernization. However, sustaining momentum will require:

• Continued investment in R&D.
• Stronger public-private collaboration.
• Vigilant monitoring of geopolitical developments.

This reform wave reflects India’s intent to transform its armed forces into a technologically advanced, combat-ready team while ensuring welfare and governance improvements.