India's Defence Shift
India’s defence manufacturing sector is undergoing a strategic shift, prioritizing design and innovation to enhance its global competitiveness. At the ET Deftech Summit 2026, industry leaders and policymakers emphasized the need to move beyond ‘Make in India’ to ‘Design in India’. This transition aims to foster a robust domestic defence industry capable of driving long-term growth and attracting investment.
Domestic procurement and policy momentum have already strengthened the sector, setting the stage for deeper R&D and more resilient supply chains. Rajalakshmi Menon of DRDO highlighted that modern warfare is increasingly data-driven, network-centric, and autonomous. This evolution requires India’s defence innovation ecosystem to realign its R&D priorities towards advanced technologies and digital capabilities.
The shift towards design and data-driven warfare is expected to create new opportunities for private equity and venture capital investments in India’s defence sector. Companies focusing on cutting-edge technologies, such as AI, cybersecurity, and autonomous systems, are likely to attract significant capital. This strategic realignment not only enhances India’s defence capabilities but also positions it as a key player in the global defence market, offering attractive returns for investors.
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