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Economic Times
6 days ago
- Business
- Economic Times
A windfall is coming for India's surging defence exports
TIL Creatives Indian defence stocks are surging following NATO's announcement to increase defence spending The stock market movement today could be a signifier of big things in store for India's defence export companies. Defence stocks such as Sika Interplant Systems, Data Patterns, BEL and BEML rose up to 5% on Thursday morning. The trigger was a NATO announcement. India's defence sector, once considered heavily import-dependent, is now emerging as a credible global supplier. In recent years, a series of policy reforms, investments and growing industrial capabilities have propelled Indian defence exports to new highs. Now, a windfall is taking shape which can boost India's defence exports further. NATO has announced at the recent summit in The Hague to increase member nations' defence spending to 5% of GDP by 2035. The convergence of NATO's spending surge, Europe's quest for strategic autonomy and India's growing defence manufacturing capability has created a rare alignment of interest and opportunity. For Indian defence manufacturers, the coming decade may well mark a transformational phase, one that could redefine the country's role in global military supply chains. Reliance Defence has secured Rs 600 crore worth of export order from Germany's leading defence manufacturer Rheinmetall Waffe Munition GmbH. Following its recently announced strategic partnership with Rheinmetall, this order is one of the largest contracts in the high-tech ammunition domain. Reliance will supply ammunition like artillery shells and explosives from a new facility to be set up in Maharashtra. The deal comes after Reliance Defence's joint ventures with Dassault Aviation and Thales of France. Recently, Reliance Defence, a subsidiary of Reliance Infrastructure, also entered into a strategic cooperation agreement with Germany's Diehl Defence. The partnership will focus on the local production of the Vulcano 155mm precision-guided munition system, an advanced artillery shell designed for long-range, high-accuracy strikes. Reliance Defence deal with Rheinmetall could be a precursor of a windfall as Europe's planned hike in defence spending will offer more opportunities for Indian defence manufacturers, especially for supply of sub-systems, components, ammunition and other equipment as well as joint projects. NATO's move stems from a growing recognition of geopolitical volatility and strategic vulnerability. Russia's war in Ukraine has exposed the military deficiencies of several European nations and underscored their dependency on the US for security guarantees and military equipment. As a result, the alliance is now aiming for deeper self-reliance and rapid capacity enhancement. Raising defence spending to 5% of GDP is not just symbolic; it translates to hundreds of billions of dollars in additional defence outlay annually across NATO members. Meeting this demand through existing supply chains will be challenging, especially in Europe, where defence manufacturing capacity is limited, and workforce shortages are adding momentum to this shift is the Draghi report on EU competitiveness. Authored by former ECB President Mario Draghi, the report calls for a comprehensive revitalisation of Europe's industrial capacity, with a strong emphasis on achieving strategic autonomy in the defence sector. Crucially, it recommends reducing the EU's reliance on the US for defence imports and instead investing more within building up this capacity will take years, and in the interim, the EU will need reliable, cost-effective external partners to bridge the gap. India, with its increasingly advanced defence manufacturing capabilities and growing diplomatic ties with Europe, is uniquely positioned to fill this role. Moreover, an expanded defence manufacturing base in Europe will also need component suppliers which can be an opportunity for India's growing defence industrial base with a large number of small and big private players. Amidst a push for 'Atmanirbhar Bharat', India's defence exports reached a record high of Rs 23,622 crore (approximately $2.76 billion) in the last financial year 2024-25. Compared to the previous fiscal year's figure of Rs 21,083 crore, this represents an increase of Rs 2,539 crore, equivalent to a 12.04% growth. As per the Ministry of Defence (MoD), India already exports to around 80 countries and aims for Rs 50,000 crore in exports by 2029, strengthening its global defence manufacturing footprint. Compared to a revenue of Rs 686 crore in FY 2013-14, the FY 2024-25 number of Rs 23,622 crore is a 34 times increase, as per the export performance of Defence Public Sector Undertakings (DPSUs) has demonstrated substantial improvement with a 42.85% increase in FY 2024-25, indicating strong international acceptance of Indian defence products and the sector's capability to integrate into global supply networks, as per the MoD. In FY 2024-25, private sector contributions amounted to Rs 15,233 crore, whilst DPSUs generated Rs 8,389 crore in exports. These figures show an improvement from FY 2023-24, when private sector exports stood at Rs 15,209 crore and DPSU exports at Rs 5,874 government has implemented numerous policy changes in recent years to strengthen India's defence sector, MoD said. These include streamlining industrial licensing processes, deregulating components from licensing requirements, and lengthening license validity periods. Furthermore, during the previous financial year, the Standard Operating Procedure for export authorisation underwent simplification, with additional provisions introduced to enhance the country's export capabilities. You Might Also Like: What does NATO's 5% spending deal really mean? Public sector companies such as Hindustan Aeronautics Limited (HAL) and Bharat Electronics Limited (BEL) have been at the forefront, but the private sector is rapidly catching up. The entry of major conglomerates like Larsen & Toubro, Tata Advanced Systems and Reliance Defence has created a dynamic and competitive ecosystem. India's defence sector is poised for substantial growth amid global shifts, according to a recent report by brokerage firm Nuvama. Defence exports are expected to reach Rs 203 billion in FY25, with a government target of Rs 500 billion by FY29. European defence orders could begin flowing as early as the first half of FY26, marking a major milestone for the sector. Given Europe's manufacturing constraints, Indian defence companies are well-positioned to capitalize on rising export opportunities. Europe's limited local manufacturing capacity and workforce shortages are opening doors for Indian defence manufacturers to step in. "Europe's defence expansion is constrained by limited local manufacturing capacity and skilled workforce shortages, especially in aerospace and missile supply chains. As a result, European nations are increasingly looking at partnerships and collaborations with Indian defence manufacturers," Nuvama said. This creates an environment where Indian defence manufacturers can step in, not just as low-cost suppliers but as serious contributors to high-tech systems and platforms too. India's competitive advantage lies in its cost structure, manufacturing capacity and rapidly maturing technological base. Its large, skilled workforce and expanding industrial infrastructure give it the scalability that many European countries currently lack. Furthermore, India's recent advances in defence R&D, ranging from the Tejas light combat aircraft and BrahMos missiles to UAVs and naval systems, have increased its credibility as a supplier of complete solutions, not just parts. This opportunity is as much geopolitical as it is commercial. India is seen as a neutral, democratic and increasingly strategic partner by many European nations. Unlike imports from China or Russia, Indian defence exports come with fewer political strings and are more acceptable in terms of values and alignment. This strategic trust could lead to deeper cooperation beyond simple exports, including co-development initiatives, joint ventures and technology partnerships in critical sectors such as artificial intelligence, cyber warfare, electronic systems and autonomous the road ahead is not without challenges. Indian firms must meet stringent NATO quality standards and ensure timely deliveries, especially in an industry where reliability is paramount. Regulatory bottlenecks, such as export licensing and customs clearances, need to be streamlined further. The government's continued support in terms of policy clarity, R&D funding, and export facilitation will be critical. Additionally, India must focus on moving up the value chain -- from supplying components and subsystems to offering full-fledged platforms and integrated systems.
Time of India
7 days ago
- Business
- Time of India
A windfall is coming for India's surging defence exports
The stock market movement today could be a signifier of big things in store for India's defence export companies. Defence stocks such as Sika Interplant Systems, Data Patterns, BEL and BEML rose up to 5% on Thursday morning. The trigger was a NATO announcement. India's defence sector, once considered heavily import-dependent, is now emerging as a credible global supplier. In recent years, a series of policy reforms, investments and growing industrial capabilities have propelled Indian defence exports to new highs. Now, a windfall is taking shape which can boost India's defence exports further. NATO has announced at the recent summit in The Hague to increase member nations' defence spending to 5% of GDP by 2035. The convergence of NATO's spending surge, Europe's quest for strategic autonomy and India's growing defence manufacturing capability has created a rare alignment of interest and opportunity. For Indian defence manufacturers, the coming decade may well mark a transformational phase, one that could redefine the country's role in global military supply chains. Reliance deal is a precursor of a windfall Reliance Defence has secured Rs 600 crore worth of export order from Germany's leading defence manufacturer Rheinmetall Waffe Munition GmbH. Following its recently announced strategic partnership with Rheinmetall, this order is one of the largest contracts in the high-tech ammunition domain. Reliance will supply ammunition like artillery shells and explosives from a new facility to be set up in Maharashtra. The deal comes after Reliance Defence's joint ventures with Dassault Aviation and Thales of France. Recently, Reliance Defence, a subsidiary of Reliance Infrastructure , also entered into a strategic cooperation agreement with Germany's Diehl Defence. The partnership will focus on the local production of the Vulcano 155mm precision-guided munition system, an advanced artillery shell designed for long-range, high-accuracy strikes. Live Events You Might Also Like: Reliance Defence secures Rs 600 cr export order from Rheinmetall Germany Reliance Defence deal with Rheinmetall could be a precursor of a windfall as Europe's planned hike in defence spending will offer more opportunities for Indian defence manufacturers, especially for supply of sub-systems, components, ammunition and other equipment as well as joint projects. Why India can be a preferred defence supplier to NATO countries NATO's move stems from a growing recognition of geopolitical volatility and strategic vulnerability. Russia's war in Ukraine has exposed the military deficiencies of several European nations and underscored their dependency on the US for security guarantees and military equipment. As a result, the alliance is now aiming for deeper self-reliance and rapid capacity enhancement. Raising defence spending to 5% of GDP is not just symbolic; it translates to hundreds of billions of dollars in additional defence outlay annually across NATO members. Meeting this demand through existing supply chains will be challenging, especially in Europe, where defence manufacturing capacity is limited, and workforce shortages are acute. Further adding momentum to this shift is the Draghi report on EU competitiveness. Authored by former ECB President Mario Draghi, the report calls for a comprehensive revitalisation of Europe's industrial capacity, with a strong emphasis on achieving strategic autonomy in the defence sector. Crucially, it recommends reducing the EU's reliance on the US for defence imports and instead investing more within Europe. However, building up this capacity will take years, and in the interim, the EU will need reliable, cost-effective external partners to bridge the gap. India, with its increasingly advanced defence manufacturing capabilities and growing diplomatic ties with Europe, is uniquely positioned to fill this role. Moreover, an expanded defence manufacturing base in Europe will also need component suppliers which can be an opportunity for India's growing defence industrial base with a large number of small and big private players. You Might Also Like: Dassault, Reliance revive Falcon jet manufacturing tie-up India's defence export surge Amidst a push for 'Atmanirbhar Bharat', India's defence exports reached a record high of Rs 23,622 crore (approximately $2.76 billion) in the last financial year 2024-25. Compared to the previous fiscal year's figure of Rs 21,083 crore, this represents an increase of Rs 2,539 crore, equivalent to a 12.04% growth. As per the Ministry of Defence (MoD), India already exports to around 80 countries and aims for Rs 50,000 crore in exports by 2029, strengthening its global defence manufacturing footprint. Compared to a revenue of Rs 686 crore in FY 2013-14, the FY 2024-25 number of Rs 23,622 crore is a 34 times increase, as per the MoD. The export performance of Defence Public Sector Undertakings (DPSUs) has demonstrated substantial improvement with a 42.85% increase in FY 2024-25, indicating strong international acceptance of Indian defence products and the sector's capability to integrate into global supply networks, as per the MoD. In FY 2024-25, private sector contributions amounted to Rs 15,233 crore, whilst DPSUs generated Rs 8,389 crore in exports. These figures show an improvement from FY 2023-24, when private sector exports stood at Rs 15,209 crore and DPSU exports at Rs 5,874 crore. The government has implemented numerous policy changes in recent years to strengthen India's defence sector, MoD said. These include streamlining industrial licensing processes, deregulating components from licensing requirements, and lengthening license validity periods. Furthermore, during the previous financial year, the Standard Operating Procedure for export authorisation underwent simplification, with additional provisions introduced to enhance the country's export capabilities. You Might Also Like: What does NATO's 5% spending deal really mean? Public sector companies such as Hindustan Aeronautics Limited (HAL) and Bharat Electronics Limited (BEL) have been at the forefront, but the private sector is rapidly catching up. The entry of major conglomerates like Larsen & Toubro, Tata Advanced Systems and Reliance Defence has created a dynamic and competitive ecosystem. India's edge: Cost, capacity and credibility India's defence sector is poised for substantial growth amid global shifts, according to a recent report by brokerage firm Nuvama. Defence exports are expected to reach Rs 203 billion in FY25, with a government target of Rs 500 billion by FY29. European defence orders could begin flowing as early as the first half of FY26, marking a major milestone for the sector. Given Europe's manufacturing constraints, Indian defence companies are well-positioned to capitalize on rising export opportunities. Europe's limited local manufacturing capacity and workforce shortages are opening doors for Indian defence manufacturers to step in. "Europe's defence expansion is constrained by limited local manufacturing capacity and skilled workforce shortages, especially in aerospace and missile supply chains. As a result, European nations are increasingly looking at partnerships and collaborations with Indian defence manufacturers," Nuvama said. This creates an environment where Indian defence manufacturers can step in, not just as low-cost suppliers but as serious contributors to high-tech systems and platforms too. India's competitive advantage lies in its cost structure, manufacturing capacity and rapidly maturing technological base. Its large, skilled workforce and expanding industrial infrastructure give it the scalability that many European countries currently lack. Furthermore, India's recent advances in defence R&D, ranging from the Tejas light combat aircraft and BrahMos missiles to UAVs and naval systems, have increased its credibility as a supplier of complete solutions, not just parts. This opportunity is as much geopolitical as it is commercial. India is seen as a neutral, democratic and increasingly strategic partner by many European nations. Unlike imports from China or Russia, Indian defence exports come with fewer political strings and are more acceptable in terms of values and alignment. This strategic trust could lead to deeper cooperation beyond simple exports, including co-development initiatives, joint ventures and technology partnerships in critical sectors such as artificial intelligence, cyber warfare, electronic systems and autonomous weapons. However, the road ahead is not without challenges. Indian firms must meet stringent NATO quality standards and ensure timely deliveries, especially in an industry where reliability is paramount. Regulatory bottlenecks, such as export licensing and customs clearances, need to be streamlined further. The government's continued support in terms of policy clarity, R&D funding, and export facilitation will be critical. Additionally, India must focus on moving up the value chain -- from supplying components and subsystems to offering full-fledged platforms and integrated systems. You Might Also Like: NATO allies agree to hike defence spending, reaffirm collective defence
India.com
14-06-2025
- Business
- India.com
Pakistan, China to face heat as Anil Ambani inks deal with German company to...., deal is with Rs ..
Anil Ambani (File) Reliance Defence has signed an agreement with German company Diehl Defence to make the advanced Vulcano 155mm Precision-Guided Munition System in India. These are special artillery shells that can hit targets with very high accuracy using laser and GPS guidance. The agreement supports India's goal to reduce dependence on foreign weapons and boost local defence manufacturing. The shells will be made in a new factory in Ratnagiri, Maharashtra. This area is part of the upcoming Dhirubhai Ambani Defence City. Production will include more than 50 per cent locally made parts, helping the 'Make in India' mission. Announced on June 10, the strategic cooperation will see Reliance Defence handle the production, while Diehl Defence will provide the key technology and guidance systems. These shells are designed for long-distance and accurate strikes, especially useful in situations where hitting the right target is more important than firing many rounds. This deal is expected to bring in Rs. 10,000 crore in business, and it will help India reach its goal of exporting Rs. 50,000 crore worth of defence products by 2029. The project shows how India is building strong capabilities in advanced weapons manufacturing and moving toward self-reliance in defence. The collaboration, which builds upon an earlier pact signed in 2019, also reflects Reliance Defence's intent to emerge among the top three private defence exporters in India. The Vulcano 155mm system is equipped with laser and GPS-guided navigation, capable of hitting targets with exceptional accuracy. Its inclusion in India's artillery arsenal will significantly enhance the operational capabilities of the armed forces, especially in high-stakes combat situations that demand precision over volume.
India Today
11-06-2025
- Business
- India Today
Reliance ties up with Germany's Diehl to produce next-gen ammunitions
In a significant push towards defence indigenisation, Reliance Defence has partnered with Germany's Diehl Defence to locally manufacture the cutting-edge Vulcano 155mm precision-guided munition system. The agreement marks a critical stride in India's ambition to reduce reliance on foreign military imports and strengthen its domestic defence production on June 10, the strategic cooperation will see Reliance Defence take the lead as the prime manufacturer, with Diehl Defence supplying core technologies and guidance systems. The advanced artillery shells—designed for long-range, high-precision strikes—will be produced at a greenfield facility in Ratnagiri's Watad Industrial Area, part of the upcoming Dhirubhai Ambani Defence Vulcano 155mm system is equipped with laser and GPS-guided navigation, capable of hitting targets with exceptional accuracy. Its inclusion in India's artillery arsenal will significantly enhance the operational capabilities of the armed forces, especially in high-stakes combat situations that demand precision over volume. Reliance Defence anticipates the partnership could generate business worth Rs 10,000 crore, underlining the growing market for precision ammunition and the strategic value of localising such technologies. The project is expected to deliver more than 50% indigenous content, supporting India's 'Aatmanirbhar Bharat' vision and contributing to the government's Rs 50,000 crore defence export goal by this collaboration, Reliance Defence positions itself at the forefront of India's next-gen ammunition manufacturing drive, bringing together global expertise and local execution for a future-ready
Time of India
11-06-2025
- Business
- Time of India
Reliance Power, Infra shares rally: What's driving the Anil Ambani-owned Reliance stock surge? Check details
Representative AI image NEW DELHI: Anil Ambani-led Reliance ADAG stocks, Reliance Power and Reliance Infrastructure have been on a strong upward trajectory, driven by a series of positive developments. On Wednesday, Reliance Power surged over 5% in morning trade, taking its monthly gains to over 70%. Reliance Infrastructure also gained 1% in early trade today and has jumped nearly 60% in the last month. Reliance Power hit a fresh 52-week high of Rs 67.68 on Tuesday, extending a month-long rally of 76% and a 173% gain over the past year. The rally in both stocks is being fueled by multiple triggers, project wins, favourable court orders, equity infusions, and a strong return to profitability. Reliance Power alone rose 45.5% in May and has added another 10% in the past week. What's driving the surge in Reliance Power and Infra stocks? Reliance Group stocks have seen a sharp rally, backed by strong quarterly results, major project wins, financial restructuring, and renewed investor confidence, as per reports. Reliance Power's strong Q4 turnaround: The company posted a consolidated profit of Rs 125.57 crore in Q4 FY25, reversing a loss of Rs 397.56 crore in the same period last year. This shift was driven by cost-cutting measures and fresh equity infusion from its promoter and investors. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like local network access control Esseps Learn More Big project wins further lifted sentiment: On May 28, Reliance NU Energies, a Reliance Power unit, secured a 350 MW solar power and 175 MW/700 MWh battery storage project from PSU SJVN. Another subsidiary, Reliance NU Suntech, recently signed a 25-year PPA with SECI for Asia's largest solar-plus-storage project, with 930 MW of solar capacity and 465 MW/1,860 MWh of battery storage, with a planned investment of up to Rs 10,000 crore. Cross-border clean energy collaboration: Reliance Power has signed a commercial term sheet with Bhutan's Green Digital Pvt Ltd for a long-term power purchase agreement, marking a major milestone in cross-border clean energy collaboration. Green Digital is a subsidiary of Druk Holding and Investments Ltd (DHI), the investment arm of the Royal Government of Power also raised Rs 348 crore in May through preferential allotments, strengthening its balance sheet. Reliance Infrastructure: Reliance Defence, a subsidiary of Reliance Infrastructure, has announced on June 10 a strategic cooperation agreement with Germany's Diehl Defence to manufacture advanced artillery systems in India. The focus of the partnership will be on producing the Vulcano 155mm precision-guided munition system, an artillery shell known for its long-range and high accuracy. "Diehl Defence looks forward to strengthening the current relationship with Reliance in the context of TGM for the Indian Armed Forces," Helmut Rauch, CEO of Diehl Defence said. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
