By TN Ashok
India has thrown open to private enterprise one of the last major bastions of state control in defence production: the manufacture of conventional missiles.
In a decision with far-reaching consequences for both India’s military preparedness and its emerging ambitions as an arms exporter, Defence Minister Rajnath Singh has approved the transfer of Defence Research and Development Organisation (DRDO) technology for all conventional missile systems to qualified Indian private companies.
The move effectively puts private industry on the same competitive field as state-owned defence manufacturers, including Bharat Dynamics Ltd (BDL), which has traditionally been the principal production agency for many Indian missiles. It sort of enjoyed monopoly but now faces the challenge of competition in exports.
It is a dramatic departure from the old system under which DRDO designed and developed a missile, after which a government-owned production agency was nominated to manufacture it. Under the new system, private companies will compete for technology-transfer and development-cum-production contracts.
But there is an important red line. India is opening the conventional missile arsenal, not its strategic nuclear deterrent. The Agni and K-series strategic missiles remain outside the transfer programme. BrahMos is also outside it, but for a different reason: it is an India-Russia joint programme governed by separate arrangements.
There is also a technical correction worth making. Agni is a family of ballistic missiles, with the longest-range versions often described as ICBM-class; BrahMos is not an ICBM. It is a supersonic cruise missile, jointly developed by India and Russia, and can be launched from land, sea and air.
Why open the gates now? The answer is simple: India needs missiles in much larger numbers and much faster than the existing state-dominated system can reliably produce them.
Modern warfare has demonstrated that missiles are no longer prestige weapons fired occasionally. Ukraine, the Middle East and the recent wars in West Asia have shown the importance of having large stocks of precision weapons, air-defence interceptors, anti-ship missiles and tactical ballistic systems.
India also faces two-front security challenges from China and Pakistan. The Army and Air Force need air-defence missiles; the Navy needs anti-ship weapons; fighter aircraft require air-to-air missiles; and the armed forces need increasingly sophisticated weapons capable of destroying radar installations, command centres and other targets at long distances.
A single state-owned production line cannot easily provide that scale.
The government therefore wants to move missiles from the laboratory to the factory floor. The Defence Ministry says the new policy will increase domestic manufacturing capacity, reduce import dependence, raise domestic value addition and bring MSMEs and technology partners deeper into the defence supply chain.
The likely early candidates include Astra air-to-air missiles, Akash and Akash-NG, VSHORADS, Rudram anti-radiation missiles, Nag and other anti-tank weapons, the Naval Anti-Ship Missile and Pralay, among others.
Pralay is particularly significant because it is a conventionally armed quasi-ballistic missile designed for precision strikes against targets at considerable distances.
The BDL monopoly gets challenged; For decades, Bharat Dynamics has been the workhorse of India’s missile manufacturing ecosystem. That position is now under competitive pressure.
The government believes competition can do what monopoly cannot: lower costs, improve manufacturing efficiency, encourage innovation and force companies to meet delivery schedules. Instead of automatically handing a production order to a PSU, the Ministry of Defence intends to introduce competitive bidding among qualified Indian companies for technology transfer and development-cum-production partnerships.
The private sector has already been moving rapidly into the missile business.
Adani Defence, Bharat Forge, Tata Advanced Systems, Larsen & Toubro, Solar Industries and ICOMM Tele are among companies with existing missile-related capabilities, partnerships or DRDO programmes. Adani, for example, has announced a ₹2,500-crore investment in a large private-sector missile manufacturing ecosystem in Madhya Pradesh.
Adani is already a development-and-production partner for some DRDO missile programmes, while Bharat Forge and Tata have built substantial defence manufacturing capabilities. Solar Industries has also expanded aggressively from explosives and ammunition into advanced defence systems.
For these companies, missiles represent an enormous new market.
And there is money abroad; India’s defence exports have exploded. They reached a record ₹38,424 crore, or roughly $4.5 billion, in FY 2025-26, up 62.66 per cent from ₹23,622 crore the previous year. The private sector accounted for ₹17,353 crore, or 45.16 per cent, while DPSUs accounted for ₹21,071 crore. India now exports defence equipment to more than 80 countries.
But there is an important caveat: the government does not publish a separate figure for missile exports within that $4.5-billion total. Therefore, it would be misleading to say that India exported a particular number of dollars’ worth of missiles in 2025-26.
The publicly known missile contracts, however, demonstrate the potential. The Philippines signed a $375-million BrahMos contract in 2022 for three coastal missile batteries.
Armenia became the first foreign customer for the Akash missile system, in a deal reported at about $230 million.
Indonesia has now entered into an agreement involving BrahMos missiles and Astra air-to-air missiles. Reuters reported the package at approximately $630 million, although the Indonesian side did not publicly disclose the detailed value of the BrahMos component separately.
Vietnam has also been identified as a BrahMos customer, while several other countries have expressed interest. India’s missile diplomacy is increasingly concentrated in Southeast Asia and the wider Indo-Pacific, where countries are looking for alternatives to Chinese and Western suppliers.
That is precisely where the private sector sees opportunity.
Can private companies sell these missiles abroad? Not simply because they manufacture them. A private Indian company cannot decide one morning to sell an Akash, Astra or Pralay system to a foreign government.
Defence exports remain tightly controlled. The Department of Defence Production administers export authorisations for relevant munitions under the SCOMET framework and other applicable laws. DRDO’s own technology-transfer policy makes clear that military technologies remain subject to government approval for export.
In other words, the private manufacturer can become the producer and exporter, but the Indian state retains the final say over whether, what, where and to whom a sensitive weapon can be exported. The government can also impose end-user conditions, licensing restrictions and other safeguards.
But does private missile production create a security risk? This is the strongest argument against the policy. Missiles are not automobiles. Their manufacture involves propulsion technology, guidance systems, seekers, electronics, warheads, navigation, software and highly sensitive manufacturing processes.
The greater the number of companies and employees possessing such knowledge, the larger the potential security perimeter. There is the possibility of espionage, cyber theft, insider leaks, industrial intelligence by rival states and diversion of sensitive components. India’s own experience demonstrates that this is not a theoretical concern: a former DRDO scientist has been accused in an espionage case involving alleged disclosure of sensitive information concerning several missile and defence programmes.
There is another danger: commercial pressure. A company whose objective is to maximise shareholder returns naturally wants the biggest possible market. The state, however, must sometimes reject a lucrative customer because selling a weapon may alter a regional military balance.
The question therefore becomes: will commercial ambition ever collide with national security?
The government’s answer; The government clearly believes the risks can be contained. Private companies do not receive unrestricted access to the missile arsenal. They must satisfy qualification, certification, security and regulatory requirements. DRDO remains involved in technology transfer and technical oversight.
And the most sensitive weapons remain firmly outside the programme. That distinction is crucial. India is not privatising its nuclear deterrent. Agni and K-series strategic missiles remain under state control, while BrahMos remains governed by its India-Russia joint-venture framework.
The broader strategy is therefore less about selling India’s crown jewels and more about creating a large, competitive conventional missile industry. The logic is compelling: if India wants to fight a modern war, it needs ammunition in industrial quantities. If it wants to become a serious arms exporter, it needs production lines capable of serving foreign customers without starving the Indian armed forces.
The private sector sees a lucrative opportunity. The government sees industrial capacity and strategic autonomy. The military sees the prospect of a much deeper supply base.
The real test will be whether India can have all three without allowing the pursuit of the fast buck to outrun the pursuit of national security. (IPA Service)
