The Stockholm International Peace Research Institute (SIPRI) published its annual report on international armaments transfers for 2023 in March 2024. The much-anticipated lists of exporters and importers from SIPRI have raised a serious question about India’s ambitious claims regarding its expanding military-industrial complex.
According to government data, India’s arms exports for fiscal 2023-’24 totalled Rs 210.8 billion rupees (approximately $2.5 billion), representing a 32.5% increase from Rs 159 billion rupees in FY 2022-’23. According to SIPRI’s 2021 report, India achieved the 23rd position among the top 25 arms exporters. India anticipated that the success of its arms exports would enable it to reduce its reliance on foreign aid and boost the domestic arms industry in order to meet the military requirements of the Indian armed forces and sympathetic governments or friendly foreign countries.
Nevertheless, India was omitted from the top 25 arms exporters list in SIPRI’s 2022 report with the status unchanged in 2023 despite the increase in arms exports. In the interim, India maintained its status as the number one importer of arms, accounting for 9.8% of the total imports from 2019-’23, up from 9.1% of total global arms imports in 2014-’18. More than that, India’s imports went up by 4.7% from 2014-’18 to 2019-’23.
SIPRI’s recent report demonstrates two significant trends in India’s arms acquisition: An increase in defence imports despite the implementation of numerous policies and initiatives to reduce foreign dependence and expansion of India’s arms import partners.
Since 2020, the Indian government has launched several programmes aimed at reducing the country’s reliance on foreign weaponry suppliers. The government took several key initiatives to boost domestic arms manufacture, including Atmanirbhar Bharat and Defence Acquisition Procedures (DAP). The Export Promotion Policy, under the vision of Atmanirbhar Bharat, established an ambitious goal of developing a domestic arms industry of $25 billion (INR 200,000 crore) by 2025.
By formalizing the DAP in 2020, emphasis was placed on acquiring armaments from domestic vendors under the ‘Indigenously Designed, Developed and Manufactured’ (IDDM) category, with at least 50% indigenous content. To achieve self-sufficiency in defence manufacturing, the Department of Military Affairs (DMA) has released Negative Import List (NIL), or Positive Indigenous List (PIL) of major arms, platforms, systems and ammunition since 2020, putting an embargo on imports and accelerating domestic production in a controlled time frame. The DMA has produced five lists, totalling 509 items.
Currently, Indian vendors lack the technological and inventive expertise required to build and upgrade high-quality arms. These tendencies raise severe concerns about India’s huge claims and emphasize the terrible status of its indigenous industries. In addition to stiff competition from foreign providers, important hurdles include low manufacturing capacity within specified timescales and quality assurance. Low-tech weaponry with technical and mechanical flaws are unlikely to appeal to either Indian or foreign military forces.
The rise in arms imports, despite repeated measures to indigenize India’s defence industry, should prompt us to reconsider and re-evaluate existing policies to close the gaps. Arms transfers have an important role in defining foreign policy and protecting national interests. India has a long history of importing arms from various sources. As significant arms providers, the Cold War’s bipolar international system enabled the United States and the Soviet Union to dominate their customers’ foreign affairs.
India’s use of alternative arms supply, which began during the Cold War, has persisted to this day. India’s arms procurement policy has evolved from a non-alignment stance during the Cold War era to an “all-alignment” approach under the modern concept of strategic autonomy. This shift means that—while India maintains strategic autonomy, ensuring it is not overly dependent on any single country for its defence needs—it now engages with a diverse range of countries for arms supplies. This diversified strategy enables India to enhance its defence capabilities by accessing advanced technologies and maintaining flexibility in its foreign relations.
Developing diverse partnerships for armaments has been a key strategy for India. This approach helps counter the dominance and political influence of any single supplier. It also offers India more flexibility and independence in its defence procurement. From 2014 to 2018, India was one of the top three buyers from each of the five largest arms exporters in the world. These exporters were among the top 25 in terms of market share. India was responsible for 31% of Russia’s exports, 30% of France’s, 13% of South Korea’s, 37% of Israel’s and 15% of South Africa’s.
During 2019-’23, India received arms from seven major exporters. India accounted for 29% of France’s total exports, Russia (34%), Israel (37%), South Korea (15%), Ukraine (11%), South Africa (13%) and Poland (0.6%). India’s 4.7% increase in weaponry imports led to Ukraine and Poland emerging as potential suppliers.
Diversifying its armaments suppliers has allowed India more independence in foreign policy and decision-making. However, this strategy has also caused some trust issues with major suppliers, such as the US. To build a robust military-industrial complex, India does not need mechanical equipment alone. It requires advanced technologies and innovative capabilities, areas where the US surpasses all other suppliers.
The US and India are not formal military allies, but are strategic partners with shared challenges and opportunities. In 2016, the US designated India as a major defense partner (MDP), allowing India access to advanced arms technology typically reserved for the US’s formal allies and NATO partners.
However, India’s diversified arms trade, especially with Russia, has made the US hesitant to share technology with Indian companies. This, possibly, explains why the Defense Trade and Technology Initiative launched in 2012 by US Deputy Defense Secretary Ashton Carter to enhance defence cooperation and technology transfer and to support co-production and co-development of arms in India has not been successful.
India is mindful of its global image, which influences its foreign policy to avoid relying too much on traditional partners or long-standing allies. India aims to stay neutral, maintaining the freedom to pursue its strategic and national interests. Strategic autonomy is certainly the best approach for India.
However, having too many options can lead to trust issues with potential partners, which hampers strategic and technology cooperation. When making decisions about arms acquisitions, India needs to address these issues and reaffirm its policies to balance different approaches for building an effective military-industrial complex.