A shift towards indigenisation: 'Make in India' fortifies defence spending

An analysis of defence capex over the past 12 years shows a noticeable shift towards indigenisation

An analysis of defence capital expenditure (capex) indicates increased spending during the last four or five years, along with a discernible shift towards indigenisation. Adjusted for inflation, capital allocations to the defence sector have grown at a compounded rate of around 7 per cent between the base year (2011-12) and the present (2022-23).

While rupee-denominated spending has grown at a little better than 8 per cent, imports have grown at just 1.2 per cent during this 11-fiscal year period. The allocation patterns have been quite uneven.

Let’s explain how we’ve examined the data. We looked for defence capital allocations, including