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India's Defence Exports: From Buyer to Seller

₹1,521 crore in 2017. ₹23,000 crore in 2025. Brahmos to the Philippines. Pinaka to Armenia. The ₹50,000 crore target is now the floor.

Sachin Aggarwal profile image
by Sachin Aggarwal
India's Defence Exports: From Buyer to Seller

India has been a WTO member since the organisation's founding in 1995. In three decades of membership, it has been among the most active developing country participants in multilateral trade negotiations — simultaneously defending its right to protect domestic industries and food security, pushing back against Western agricultural subsidies, and advocating for a fairer trading system for developing economies. It has also been among the most frequent users of WTO dispute settlement, both as complainant and respondent.

The WTO in 2026 is an institution under existential pressure. The Appellate Body — the organisation's supreme trade court — has been non-functional since 2019, when the United States blocked the appointment of new members under both the Biden and Trump administrations. The Doha Development Round, launched in 2001, has never been concluded. The rise of industrial policy — PLI schemes, the US Inflation Reduction Act, the EU Green Deal — has created a new generation of trade-distorting measures that WTO rules were not designed to govern. And the US-China trade war has created bilateral trade barriers of a scale that multilateral rules cannot easily address.

In this environment, India's WTO strategy matters more than ever — and its current posture requires a fundamental rethink.


India's Traditional WTO Position

India's WTO stance has historically been defensive — protecting its policy space from disciplines that would constrain its development strategy. It has resisted agricultural subsidy caps that would limit its MSP regime. It has opposed TRIPS-plus intellectual property provisions that would raise pharmaceutical costs. It has blocked fisheries subsidies agreements that it argued would disadvantage small-scale fishermen. And it has consistently invoked Special and Differential Treatment provisions to maintain tariff flexibility that larger developing countries can no longer credibly claim.

This defensive posture served India's interests when it was primarily a trade policy taker — a country whose main WTO objective was to protect domestic markets from liberalisation pressure while maintaining export access. India is no longer in that position. With a $3.9 trillion economy, export ambitions in goods and services that require open global markets, and a manufacturing programme that depends on access to international supply chains, India's interests in the WTO system are increasingly those of a major trading power, not a defensive developing country.


Where India Must Lead

Three areas of WTO engagement are strategically critical for India in the current period.

The first is Appellate Body reform. The WTO's dispute settlement system — the "crown jewel" of the multilateral trading system — is non-functional without a working Appellate Body. India has a direct interest in restoring it: as a frequent WTO complainant and respondent, India benefits from a binding dispute settlement system more than from the legal uncertainty that its absence creates. India should actively support Appellate Body reform proposals and should work with the EU — which has been the most constructive P5 partner on this issue — to build the coalition that can bring the US back into a reformed system.

The second is e-commerce. The WTO moratorium on customs duties on electronic transmissions — which has prevented countries from taxing digital trade at the border — expired in 2024 amid significant developing-country opposition. India has been among the most vocal opponents of a permanent moratorium, arguing that it deprives developing countries of tariff revenue on a growing trade category. But India's digital economy ambitions — its IT services exports, its fintech platforms, its AI startups — depend on open digital trade rules that a fragmented e-commerce governance landscape cannot provide. India needs a WTO position on e-commerce that reflects its interests as a digital economy, not merely its interests as a potential digital tariff collector.

The third is industrial policy coherence. India's PLI schemes, export promotion programmes, and domestic content requirements are already pushing against WTO subsidy disciplines. Rather than managing this tension case by case, India should engage in the broader WTO conversation about how industrial policy for development and green transition can be accommodated within multilateral rules — a conversation in which India's voice, as the world's largest developing economy, is essential.

India can be a rule-maker in the WTO system — shaping the rules that govern twenty-first century trade. Remaining a rule-taker in a system that no longer reflects the global economy's realities serves no one, including India.


The Hind covers policy, power, and strategic affairs from India's perspective. Views expressed are analytical and editorial. Slug: india-wto-rule-maker-rule-taker-2026 Excerpt: India has been a WTO member for 30 years — mostly playing defence. With a $3.9 trillion economy and major export ambitions, that posture is no longer adequate. On Appellate Body reform, e-commerce, and industrial policy, India must lead.


India's Defence Exports: From Buyer to Seller

Category: Geoeconomics | By: Sachin Aggarwal | Date: March 6, 2026


India's defence export target — ₹50,000 crore ($6 billion) by FY2028–29 — was dismissed as wildly optimistic when it was first announced. Three years ago, India's defence exports stood at ₹21,083 crore in FY2023–24, up from a mere ₹1,521 crore in FY2016–17. Today, with exports crossing ₹23,000 crore in FY2024–25 and a pipeline of orders that includes Brahmos missiles for the Philippines and Vietnam, Dornier aircraft for multiple African customers, Pinaka rocket systems for Armenia, and Advanced Towed Artillery Guns for multiple countries, the target looks not just achievable but conservative.

India's transformation from the world's largest arms importer — a position it held for most of the past two decades — into a credible arms exporter is one of the most significant industrial policy achievements of the current era. Understanding how it happened, and where it still falls short, is essential for the decade ahead.


The Policy Architecture That Made It Possible

Three policy interventions have driven India's defence export surge.

The first is the Positive Indigenisation Lists — four successive lists that ban the import of specified defence equipment and mandate their domestic production. By creating a guaranteed domestic market for Indian defence manufacturers, the PILs have provided the production scale that makes Indian equipment cost-competitive for export. The logic is simple: a production run of 100 units for domestic use makes export pricing viable in ways that a run of 10 units for export alone does not.

The second is the Defence Acquisition Procedure's "Buy Indian" and "Buy and Make Indian" categories, which reserve procurement for domestic producers and require technology transfer for foreign vendors. Combined with the liberalisation of defence FDI to 74% under automatic route and 100% under government approval, these provisions have attracted serious foreign investment in Indian defence production — Airbus helicopters in Karnataka, Lockheed Martin in Telangana, BAE Systems across multiple platforms.

The third is iDEX — the Innovations for Defence Excellence scheme — which has funded over 400 defence startups developing everything from counter-drone systems to AI-enabled surveillance platforms. iDEX products have moved from prototype to procurement faster than the traditional DRDO pipeline, creating an agile defence industrial base that complements the large platform programmes.


The Brahmos Effect

The Brahmos supersonic cruise missile — a joint venture between India's DRDO and Russia's NPO Mashinostroyenia — is India's single most consequential defence export and its most globally recognised military technology brand. The Philippines' $375 million Brahmos acquisition, completed in 2024, was the first export of the system and demonstrated that Indian-developed weapons technology is operationally credible and geopolitically acceptable to US-aligned partner nations.

Vietnam, Indonesia, and the UAE are all in advanced discussions for Brahmos exports. The extended-range Brahmos-ER variant — capable of striking targets at 450 km — has significantly expanded the system's export appeal. The development of Brahmos-NG (Next Generation), a lighter, smaller variant designed for fighter jet integration, will open the system to a broader range of export customers.


The Gaps That Remain

India's defence export success is concentrated in a relatively narrow range of products — missiles, artillery, helicopters, patrol vessels, and small arms. It does not yet extend to the high-end platforms — combat aircraft, submarines, main battle tanks, and electronic warfare systems — that represent the largest share of global defence trade. Nor has India established the after-sales service, maintenance infrastructure, and long-term support ecosystem that major defence exporters build to create enduring customer relationships.

The Russia complication is the most structural gap. India's defence industrial base remains heavily dependent on Russian technology, components, and design heritage. Exporting systems with Russian-origin content to countries subject to Western sanctions or to US-aligned partners wary of Russian technology creates a market segmentation problem that India must address through accelerated indigenisation and Western technology substitution.

India is on the right trajectory. The ₹50,000 crore target, once ambitious, is now the floor — not the ceiling.


The Hind covers policy, power, and strategic affairs from India's perspective. Views expressed are analytical and editorial.

Sachin Aggarwal profile image
by Sachin Aggarwal

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