Future of the Indian Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2021

Powered by

All the vital news, analysis, and commentary curated by our industry experts.

$1250

Between 2012 and 2016, the Indian defense budget increased at a CAGR of 3.41%, and is expected to increase significantly, at a CAGR of 6.65% during the forecast period, to reach a value of US$55.4 billion by 2021. Prolonged unresolved border issues and rising tension with two neighboring nations, China and Pakistan, are expected to fuel the defense budget in the coming years; in addition to the country’s need to replace the aging and outdated military hardware and technology. Defense capital expenditure is expected to increase from US$15 billion in 2016 to US$21.2 billion in 2021, at a CAGR of 6.63%.

Scope

• During 2012–2016, Indian defense expenditure registered growth of 3.41%, increasing from US$34 billion in 2012 to US$38.9 billion in 2016

• Defense expenditure is anticipated to register a CAGR of 6.65% over 2017–2021and reach a value of US$55.4 billion in 2021

• Over the forecast period, the country’s budget for homeland security is expected to be US$69.6 billion cumulatively

• The key areas of investment are expected to be multi-role aircraft, infrastructure construction, corvettes, surface to air missiles, and frigates

Reasons to Buy

Identify and track the global defense market and make regional comparisons to effectively target new revenue streams

Understand the importance of being led by the defense ministries in the military procurement market and define your strategies with insight on what your customers really want by analyzing recent orders, technical specifications, and the country’s expected investment pattern during 2017–2021

Make correct business decisions based on detailed analysis of the defense industry from 2017–2021,which includes the total competitive landscape of the sector with detailed profiles of the top domestic and foreign defense manufacturers along with information about their products, alliances, recent contract wins, and financial analysis

Determine prospective investment areas by gaining an in-depth understanding of the industry in terms of market opportunities

Channel resources by identifying various military requirements that are expected to generate revenues across different sectors during 2017–2021

Lockheed Martin Corporation
BAE Systems Plc.
Thales
Boeing
Mazagon Docks Limited
Hindustan Aeronautics Limited (HAL)
Bharat Electronics Limited (BEL)
Bharat Dynamics Limited (BDL)
Ordnance Factory Board
Bharat Earth Movers Limited (BEML)
Goa Shipyard Limited (GSL)
Tata Advanced Systems
Mahindra Defense Systems

Table of Contents

1 Introduction

1.1. What is this Report About?

1.2. Definitions

1.3. Summary Methodology

1.4. SDI Terrorism Index

1.5. About Strategic Defense Intelligence

2 Executive Summary

3 Market Attractiveness and Emerging Opportunities

3.1. Defense Market Size Historical and Forecast

3.1.1. Indian defense budget expected to be US$245.6 billion cumulatively over 2017-2021

3.1.2. Modernization initiatives, hostile neighbors, territorial disputes, and implementation of OROP and 7th Pay Commission will be the key growth drivers

3.1.3. Defense budget as a percentage of GDP will remain at an average of

1.6% over the forecast period

3.2. Analysis of Defense Budget Allocation

3.2.1. Revenue expenditure expected to increase over the forecast period

3.2.2. Army continues to see the largest share of the defense budget

3.2.3. Defense ministry will spend US$127.1 billion on its army over the forecast period

3.2.4. Indian MoD projected to spend US$62.2 billion on its air force over the forecast period

3.2.5. Expenditure for the navy expected to grow at a CAGR of

6.68% during 2017-2021

3.2.6. Per capita defense expenditure is expected to increase over the forecast period

3.3. Homeland Security Market Size and Forecast

3.3.1. India is projected to spend US$69.6 billion cumulatively on homeland security over the forecast period

3.3.2. Homeland security is expected to be driven by cross-border terrorism and domestic conflicts

3.3.3. India falls under "highly affected" of terrorism category

3.3.4. India has terrorism index score of

7.7

3.4. Benchmarking with Key Global Markets

3.4.1. India's defense budget expected to grow at a CAGR of

6.65%

3.4.2. The US and China dominate the global defense industry

3.4.3. India allocates a lower share of its GDP to defense than other Asian countries

3.4.4. India faces significant threat from foreign terrorist organizations

3.5. Market Opportunities: Key Trends and Growth Stimulators

3.5.1. Multi-role Aircraft

3.5.2. Infrastructure Construction

3.5.3. Corvettes

3.5.4. Surface to Air Missiles

3.5.5. Frigates

4 Defense Procurement Market Dynamics

4.1. Import Market Dynamics

4.1.1. Indian defense imports slowly declining

4.1.2. Russia dominates Indian arms imports

4.1.3. Aircraft accounted for the majority of defense imports during 2011-2015

4.2. Export Market Dynamics

4.2.1. India's low profile in defense exports is set to change over the forecast period

4.2.2. Underdeveloped nations across Asia and Africa are the main importers of Indian defense goods

5 Industry Dynamics

5.1. Five Forces Analysis

5.1.1. Bargaining power of supplier: low to high

5.1.2. Bargaining power of buyer: high

5.1.3. Barrier to entry: medium to high

5.1.4. Intensity of rivalry: high

5.1.5. Threat of substitution: medium to high

6 Market Entry Strategy

6.1. Market Regulation

6.1.1. Defense Procurement Procedure (DPP) – 2016: A significant improvement

6.1.2. Offset policy to drive defense industrial modernization

6.1.3. Main features of revised Defense Procurement Procedure (DPP) – 2016

6.1.4. Private sectors permitted to produce arms and ammunition under the new Draft Arms and Ammunitions Manufacturing Policy (DAAM)

6.1.5. Foreign direct investment (FDI) increased to 49% in the Indian defense sector

6.2. Market Entry Route

6.2.1. Foreign OEMs are forming joint ventures in order to enter the market

6.2.2. India emerges as a key outsourcing hub for global defense companies

6.3. Key Challenges

6.3.1. Offset policy is biased towards the domestic public and private sectors

6.3.2. Insufficient information and transparency on future plans

6.3.3. Bureaucracy, corruption, and long project delays

6.3.4. Developing advanced low-cost solutions is essential to gain market share

7 Competitive landscape and Strategic Insights

7.1. Competitive landscape Overview

7.1.1. Domestic public companies have a strong presence in the Indian defense industry

7.2. Key Foreign Companies

7.2.1. Lockheed Martin Corporation – overview

7.2.2. Lockheed Martin Corporation – main products

7.2.3. Lockheed Martin Corporation – recent announcements and strategic initiatives

7.2.4. Lockheed Martin Corporation – alliances

7.2.5. Lockheed Martin Corporation – recent contract wins

7.2.6. BAE Systems Plc. – overview

7.2.7. BAE Systems Plc. – main products

7.2.8. BAE Systems Plc. – recent announcements and strategic initiatives

7.2.9. BAE Systems Plc. – alliances

7.2.10. BAE Systems Plc. – recent contract wins

7.2.11. Thales – overview

7.2.12. Thales – main products

7.2.13. Thales – recent announcements and strategic initiatives

7.2.14. Thales – alliances

7.2.15. Thales – recent contract wins

7.2.16. Boeing – overview

7.2.17. Boeing – main products

7.2.18. Boeing – recent announcements and strategic initiatives

7.2.19. Boeing – alliances

7.2.20. Boeing – recent contract wins

7.3. Key Public Sector Companies

7.3.1. Mazagon Docks Limited – overview

7.3.2. Mazagon Docks Limited – main products

7.3.3. Mazagon Docks Limited – recent announcements and strategic initiatives

7.3.4. Mazagon Docks Limited – alliances

7.3.5. Mazagon Docks Limited – recent contract wins

7.3.6. Mazagon Docks Limited – Financial analysis

7.3.7. Hindustan Aeronautics Limited – overview

7.3.8. Hindustan Aeronautics Limited – main products and services

7.3.9. Hindustan Aeronautics Limited – recent announcements and strategic initiatives

7.3.10. Hindustan Aeronautics Limited – alliances

7.3.11. Hindustan Aeronautics Limited – recent contract wins

7.3.12. Hindustan Aeronautics Limited – Financial analysis

7.3.13. Bharat Electronics Limited – overview

7.3.14. Bharat Electronics Limited – main products and services

7.3.15. Bharat Electronics Limited – recent announcements and strategic initiatives

7.3.16. Bharat Electronics Limited – alliances

7.3.17. Bharat Electronics Limited – recent contract wins

7.3.18. Bharat Electronics Limited – Financial analysis

7.3.19. Bharat Dynamics Limited – overview

7.3.20. Bharat Dynamics Limited – main products

7.3.21. Bharat Dynamics Limited – recent announcements and strategic initiatives

7.3.22. Bharat Dynamics Limited – alliances

7.3.23. Bharat Dynamics Limited – recent contract wins

7.3.24. Bharat Dynamics Limited – Financial analysis

7.3.25. Ordnance Factory Board – overview

7.3.26. Ordinance Factory Board – main products

7.3.27. Ordinance Factory Board – recent announcements and strategic initiatives

7.3.28. Ordinance Factory Board – alliances

7.3.29. Ordinance Factory Board – recent contract wins

7.3.30. BEML – overview

7.3.31. BEML – main products

7.3.32. BEML – recent announcements and strategic initiatives

7.3.33. BEML – alliances

7.3.34. Goa Shipyard Limited – overview

7.3.35. Goa Shipyard Limited – main products and services

7.3.36. Goa Shipyard Limited – recent announcements and strategic initiatives

7.3.37. Goa Shipyard Limited – alliances

7.3.38. Goa Shipyard Limited – recent contract wins

7.4. Key Private Sector Companies

7.4.1. Tata Advanced Systems Limited – overview

7.4.2. Tata Advanced Systems Limited – main products

7.4.3. Tata Advanced Systems Limited – recent announcements and strategic initiatives

7.4.4. Tata Advanced Systems Limited – alliances

7.4.5. Tata Advanced Systems Limited – recent contract wins

7.4.6. Mahindra Defense Systems – overview

7.4.7. Mahindra Defense Systems – main

7.4.8. Mahindra Defense Systems – recent announcements and strategic initiatives

7.4.9. Mahindra Defense Systems – alliances

8 Business Environment and Country Risk

8.1. Economic Performance

8.1.1. GDP Per Capita, USD

8.1.2. GDP (current USD Billion)

8.1.3. Exports of goods and services (current LCU Billion)

8.1.4. Imports of goods and services (current LCU Billion)

8.1.5. Gross National Disposable Income (USD Billion)

8.1.6. LCU per USD (period average)

8.1.7. Market Capitalization of Listed Companies (USD Billion)

8.1.8. Market Capitalization of Listed Companies (% of GDP)

8.1.9. Total Government cash surplus/deficit as % of GDP (LCU)

8.1.10. Goods exports as a percentage of GDP

8.1.11. Goods imports as a percentage of GDP

8.1.12. Services imports as a percentage of GDP

8.1.13. Services Exports as a percentage of GDP

8.1.14. Foreign direct investment, net (BoP, current US$ Bn)

8.1.15. Net foreign direct investment as % of GDP

8.2. Minerals

8.2.1. Mining, Manufacturing, and Utilities Output (US$ Bn)

9 Appendix

9.1. About SDI

9.2. Disclaimer

Table

Table 1: Indian Defense Expenditure (INR billion & US$ billion), 2012-2021

Table 2: Indian GDP Growth vs. Defense Expenditure as Percentage of GDP Growth, 2012-2021 (US$ bn)

Table 3: Indian Defense Budget Split Between Capital and Revenue Expenditure (%), 2012-2021

Table 4: Indian Defense Budget Split (%), 2012-2021

Table 5: Indian Defense Expenditure (INR billion & US$ billion), 2012-2021

Table 6: Indian Defense Expenditure for the air force (INR billion & US$ billion), 2012-2021

Table 7: Indian Defense Expenditure for the navy (INR billion & US$ billion), 2012-2021

Table 8: Indian Per Capita Defense Expenditure (US$), 2012-2021

Table 9: Indian Homeland Security Budget (INR billion & US$ billion), 2012-2021

Table 10:Benchmarking with Key Markets – 2012-2016 vs. 2017-2021

Table 11: SDI Research Terrorism Index

Table 12: Offset Policy in India

Table 13: Market Entry Strategies and Key Objectives of Foreign Companies in the Indian Defense Sector

Table 14: Key Players and their Operations in the Indian Defense Industry

Table 15: Scale of Operations of Domestic Public &Private Sector Companies in the Indian Defense Industry

Table 16: Lockheed Martin Corporation – Main Products

Table 17: Lockheed Martin Corporation – Alliances

Table 18: Lockheed Martin Corporation – Recent Contract Wins

Table 19: BAE Systems Plc. – Main Products

Table 20: BAE Systems Plc. – Alliances

Table 21: BAE Systems Plc. – Recent Contract Wins

Table 22: Thales – Main Products

Table 23: Thales – Alliances

Table 24: Thales – Recent Contract Wins

Table 25: Boeing – Main Products

Table 26: Boeing – Alliances

Table 27: Boeing – Recent Contract Wins

Table 28: Mazagon Docks Limited – Main Products

Table 29: Mazagon Docks Limited – Alliances

Table 30: Mazagon Docks Limited – Recent Contract Wins

Table 31: Hindustan Aeronautics Limited – Main Products and Services

Table 32: Hindustan Aeronautics Limited – Alliances

Table 33: Hindustan Aeronautics Limited – Recent Contract Wins

Table 34: Bharat Electronics Limited – Major Products and Services

Table 35: Bharat Electronics Limited – Alliances

Table 36: Bharat Electronics Limited – Recent Contract Wins

Table 37: Bharat Dynamics Limited – Main Products

Table 38: Bharat Dynamics Limited – Alliances

Table 39: Bharat Dynamics Limited – Recent Contract Wins

Table 40: Ordinance Factory Board – Main Products

Table 41: Ordinance Factory Board – Alliances

Table 42: Ordinance Factory Board – Recent Contract Wins

Table 43: BEML – Main Products

Table 44: BEML – Alliances

Table 45: Goa Shipyard Limited – Main Products and Services

Table 46: Goa Shipyard Limited – Alliances

Table 47: Goa Shipyard Limited – Recent Contract Wins

Table 48: Tata Advanced Systems Limited – Main Products

Table 49: Tata Advanced Systems Limited – Alliances

Table 50: Tata Advanced Systems Limited – Recent Contract Wins

Table 51: Mahindra Defense Systems – Main Products

Table 52: Mahindra Defense Systems – Alliances

Figures

Figure 1: Indian Defense Expenditure (INR Billion), 2012-2021

Figure 2: Indian Defense Expenditure (US$ Billion), 2012-2021

Figure 3: Indian GDP Growth vs. Defense Expenditure as Percentage of GDP Growth, 2012-2021

Figure 4:Indian Defense Budget Split Between Capital and Revenue Expenditure (%),2012-2021

Figure 5: Indian Defense Budget Split (%), 2012-2021

Figure 6: Indian Defense Expenditure for the army (INR Billion), 2012-2021

Figure 7: Indian Defense Expenditure for the army (US$ Billion), 2012-2021

Figure 8: Indian Defense Expenditure for the air force (INR Billion), 2012-2021

Figure 9: Indian Defense Expenditure for the air force (US$ Billion), 2012-2021

Figure 10: Indian Defense Expenditure for the navy (INR Billion), 2012-2021

Figure 11: Indian Defense Expenditure for the navy (US$ Billion), 2012-2021

Figure 12: Indian Per Capita Defense Expenditure (US$), 2012-2021

Figure 13: Indian Homeland Security Budget (INR billion), 2012-2021

Figure 14: Indian Homeland Security Budget (US$ billion), 2012-2021

Figure 15: SDI Terrorism Heat Map, 2016

Figure 16: SDI Terrorism Index

Figure 17: Benchmarking with Key Markets – 2012-2016 vs. 2017-2021

Figure 18: Defense Expenditure of the World's Largest Military Spenders (US$ Billion), 2016 and 2021

Figure 19: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2016

Figure 20: Multi-role Aircraft Market Size (US$ Million), 2016-2026

Figure 21: Infrastructure Construction Market Size (US$ Million), 2016-2026

Figure 22: Corvettes Market Size (US$ Billion), 2016-2026

Figure 23: Surface to Air Missiles Market Size (US$ Million), 2016-2026

Figure 24: Frigates Market Size (US$ Million), 2016-2026

Figure 25: Indian Defense Import Trend (US$ Million), 2011-2015(TIV values*)

Figure 26: Country-wise Break-up of Indian Defense Imports (%),2011-2015(TIV values*)

Figure 27: Weapon Category Break-up of Indian Defense Imports (%),2011-2015(TIV values*)

Figure 28: Indian Defense Export Trend (US$ Million), 2011-2015(TIV values*)

Figure 29: Country-wise Break-up of Indian Defense Exports (%),2011-2015(TIV values*)

Figure 30: Industry Dynamics – Porter's Five Forces Analysis

Figure 31: Mazagon Docks Limited – Revenue Trend Analysis (INR Million), 2011-2014

Figure 32: Mazagon Docks Limited – Operating Profit Trend Analysis (INR Million), 2011-2014

Figure 33: Mazagon Docks Limited – Net Profit Trend Analysis (INR Million), 2011-2014

Figure 34: Hindustan Aeronautics Limited (HAL) – Revenue Trend Analysis (INR Billion), 2010-2014

Figure 35: Hindustan Aeronautics Limited (HAL) – Operating Profit Trend Analysis (INR Billion), 2010-2014

Figure 36: Hindustan Aeronautics Limited (HAL) – Net Profit Trend Analysis (INR Billion), 2010-2014

Figure 37: Bharat Electronics Limited – Revenue Trend Analysis (INR Billion), 2009-2013

Figure 38: Bharat Electronics Limited – Operating Profit Trend Analysis (INR Billion), 2009-2013

Figure 39: Bharat Electronics Limited – Net Profit Trend Analysis (INR Billion), 2009-2013

Figure 40: Bharat Dynamics Limited – Revenue Trend Analysis (INR Million), 2011-2014

Figure 41: Bharat Dynamics Limited – Operating Profit Trend Analysis (INR Million), 2011-2014

Figure 42: Bharat Dynamics Limited – Net Profit Trend Analysis (INR Million), 2011-2014

Figure 43: GDP Per Capita in USD, 2015-2025

Figure 44: GDP (current USD billion),2015-2025

Figure 45: Exports of goods and services (current LCU Billion),2005-2014

Figure 46: Imports of goods and services (current LCU Billion),2005-2014

Figure 47: Gross National Disposable Income (USD Billion),2005-2012

Figure 48: LCU per USD (period average),2015-2024

Figure 49: Market Capitalization of Listed Companies,2005-2012

Figure 50: Market Capitalization of Listed Companies (% of GDP),2005-2012

Figure 51: Total Government Cash Surplus/Deficit as % of GDP (LCU),2005-2012

Figure 52: Goods exports as a percentage of GDP,2005-2014

Figure 53: Goods imports as a percentage of GDP,2005-2014

Figure 54: Service imports as a percentage of GDP,2005-2014

Figure 55: Services exports as a percentage of GDP,2005-2014

Figure 56: Foreign direct investment, net (BoP, current US$ Bn),2005-2014

Figure 57: Net foreign direct investment as % of GDP,2005-2014

Figure 58: Mining, Manufacturing, Utilities Output (USD Bn), 2005-2014

Frequently asked questions

Future of the Indian Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2021 thematic reports
Currency USD
$1,250

Can be used by individual purchaser only

$3,750

Can be shared globally by unlimited users within the purchasing corporation e.g. all employees of a single company


Undecided about purchasing this report?

Enquire Before Buying

Get in touch to find out about multi-purchase discounts

reportstore@globaldata.com
Tel +44 20 7947 2745

Every customer’s requirement is unique. With over 220,000 construction projects tracked, we can create a tailored dataset for you based on the types of projects you are looking for. Please get in touch with your specific requirements and we can send you a quote.

See what our customers are saying

“The GlobalData platform is our go-to tool for intelligence services. GlobalData provides an easy way to access comprehensive intelligence data around multiple sectors, which essentially makes it a one-for-all intelligence platform, for tendering and approaching customers.

GlobalData is very customer orientated, with a high degree of personalised services, which benefits everyday use. The highly detailed project intelligence and forecast reports can be utilised across multiple departments and workflow scopes, from operational to strategic level, and often support strategic decisions. GlobalData Analytics and visualisation solutions has contributed positively when preparing management presentations and strategic papers.”

Business Intelligence & Marketing Manager, SAL Heavy Lift

“COVID-19 has caused significant interference to our business and the COVID-19 intelligence from GlobalData has helped us reach better decisions around strategy. These two highlights have helped enormously to understand the projections into the future concerning our business units, we also utilise the project database to source new projects for Liebherr-Werk to use as an additional source to pitch for new business.”

Market Analyst & Management, Liebherr-Werk

Your daily news has saved me a lot of time and keeps me up-to-date with what is happening in the market, I like that you almost always have a link to the source origin. We also use your market data in our Strategic Business Process to support our business decisions. By having everything in one place on the Intelligence Center it has saved me a lot of time versus looking on different sources, the alert function also helps with this.

Head of Key Accounts, Saab AB

Having used several other market research companies, I find that GlobalData manages to provide that ‘difficult-to-get’ market data that others can’t, as well as very diverse and complete consumer surveys.

Marketing Intelligence Manager, Portugal Foods

Our experience with GlobalData has been very good, from the platform itself to the people. I find that the analysts and the account team have a high level of customer focus and responsiveness and therefore I can always rely on. The platform is more holistic than other providers. It is convenient and almost like a one stop shop. The pricing suite is highly competitive and value for our organisation.

I like reports that inform new segments such as the analysis on generation Z, millennials, the impact of COVID 19 to our banking customers and their new channel habits. Secondly the specialist insight on affluent sector significantly increases our understanding about this group of customers. The combination of those give us depth and breadth of the evolving market.

I’m in the business of answering and helping people make decisions so with the intelligence center I can do that, effectively and efficiently. I can share quickly key insights that answer and satisfy our country stakeholders by giving them many quality studies and primary research about competitive landscape beyond the outlook of our bank. It helps me be seen as an advisory partner and that makes a big difference. A big benefit of our subscription is that no one holds the whole data and because it allows so many people, so many different parts of our organisation have access, it enables all teams to have the same level of knowledge and decision support.

Head of Customer Insight and Research, Standard Chartered

“I know that I can always rely on Globaldata’s work when I’m searching for the right consumer and market insights. I use Globaldata insights to understand the changing market & consumer landscape and help create better taste & wellbeing solutions for our customers in food, beverage and healthcare industries.

Globaldata has the right data and the reports are of very high quality compared to your competitors. Globaldata not only has overall market sizes & consumer insights on food & beverages but also provides insights at the ingredient & flavour level. That is key for B2B companies like Givaudan. This way we understand our customers’ business and also gain insight to our unique industry”

Head of Consumer Sensory Insights, Givaudan

GlobalData provides a great range of information and reports on various sectors that is highly relevant, timely, easy to access and utilise.  The reports and data dashboards help engagement with clients; they provide valuable industry and market insights that can enrich client conversations and can help in the shaping of value propositions. Moreover, using GlobalData products has helped increase my knowledge of the finance sector, the players within it, and the general threats and opportunities.

I find the consumer surveys that are carried out to be extremely beneficial and not something I have seen anywhere else. They provided an insightful view of why and which consumers take (or don’t) particular financial products. This can help shape conversations with clients to ensure they make the right strategic decisions for their business.

One of the challenges I have found is that data in the payments space is often piecemeal. With GD all of the data I need is in one place, but it also comes with additional market reports that provide useful extra context and information. Having the ability to set-up alerts on relevant movements in the industry, be it competitors or customers, and have them emailed directly to me, ensures I get early sight of industry activity and don’t have to search for news.

Senior Account Manager, TSYS
Go even deeper with GlobalData Intelligence Center

Every Company Report we produce is powered by the GlobalData Intelligence Center.

Subscribing to our intelligence platform means you can monitor developments at Future of the Indian Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2021 in real time.

  • Access a live Future of the Indian Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2021 dashboard for 12 months, with up-to-the-minute insights.
  • Fuel your decision making with real-time deal coverage and media activity.
  • Turn insights on financials, deals, products and pipelines into powerful agents of commercial advantage.