India’s war readiness hinges on defence-tech startups. With global supply chains strained, indigenisation is no longer optional but imperative.
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The catch to the technological democratisation of defence industries is that it relies significantly on global supply chains. Ongoing conflicts in Ukraine and Gaza have exposed critical vulnerabilities in defence supply chains, which can be disrupted at any moment, given the unpredictable nature of geopolitics. Therefore, India's strategic imperative lies in transitioning from import dependence to indigenous innovation, transforming and supplementing the nation's preparedness for any future wars. This is where technology startups in defence assume a critical role.
Modern-day war experiences highlight that such innovation ecosystems are not only efficient and cost-effective but also capable of sustaining both protracted and short military confrontations. The 2019 standoff between India and Pakistan, along with the recent 'Operation Sindoor,' exemplifies the volatile nature of contemporary military engagements that may involve potential Chinese involvement. This situation underscores the necessity for coordinated joint responses to address adversarial threats more effectively. Global experience of conflict, such as the Russia-Ukraine conflict or the Gaza conflict, shares a similar experience. India's national security strategy fundamentally depends on leveraging private capital in defence technology.
The catch to the technological democratisation of defence industries is that it relies significantly on global supply chains.
Conventional war-fighting preparedness undergoes procedural procurement cycles or an emergency procurement (EP) mechanism—by the Ministry of Defence (MoD)—especially following an event that prompts high-level decision-making. However, such mise-en-place (set-up) often lacks futuristic thinking regarding the evolutionary aspects of war and the strategic challenges associated with it. Warfighting today encompasses precision, speed, and technological superiority that transforms the battlefield at revolutionary speed. Continuous coping with rapid transformation requires an ecosystem that is adaptive, competent, and consistent. Key technologies such as autonomous systems, Artificial Intelligence (AI) threat identification, cyber capabilities, and drone technologies demand a similar ecosystem.
India has made several strides to enhance indigenous capabilities with initiatives such as Atmanirbhar Bharat and Make in India. The recent defence budget witnessed a surge from INR 2.53 lakh crore to INR 6.81 lakh crore in 2025, with a goal of 70 percent indigenous procurement mandate. There is a veritable growth in exports from INR 686 crore in 2014 to INR 23,622 crore in 2025. The North Atlantic Treaty Organization’s (NATO) 5 percent Gross Domestic Product (GDP) target creates hundreds of billions in global market opportunities. Supporting policy frameworks include the Defence Export Promotion Policy, iDEX, and ADITI 1.0. The ecosystem now features over 1,000 defence startups and 147 military tech companies. Import ban lists are driving indigenisation in critical defence components, positioning India as both a self-reliant manufacturer and significant global defence exporter.
The ecosystem now features over 1,000 defence startups and 147 military tech companies.
Venture capital and defence tech have an age-old nexus. Several important military technologies—such as the internet, Global Positioning System (GPS), and semiconductors—have evolved from Silicon Valley’s innovations during the 1940s. This innovation ecosystem has similarly emerged in several countries, such as Israel, with approximately 300 defence startups worth US$330. In a similar continuation, India has witnessed the emergence of defence tech startups aspiring to play a greater role in forging India’s defence capabilities. India recently saw the rise of companies such as Raphe mPhibr emerging as one of the most valuable defence tech startups in India. Over the past five years, approximately 1,000 such startups have emerged. However, there remains much scope for policymakers to strengthen the systematic and continuous ecosystem that encourages innovative and tech solutions to the strategic challenges that India faces, particularly in streamlining bureaucratic processes, enhancing industry-academia collaboration, and creating sustained funding pathways beyond initial grants.
Currently, India's defence-tech sector benefits from the existence of mature technical leadership and substantial market demand. The emergence of skilled entrepreneurs with backgrounds in premier institutions such as the Indian Space Research Organisation (ISRO) and the Defence Research and Development Organisation (DRDO) has created a knowledge pipeline that bridges technical research with practical implementation capabilities. The existence of tech-driven capabilities, substantial procurement budgets, and the adoption of technology as an agenda establishes a strong foundation for growth. The potential of dual-use technology further amplifies this opportunity, enabling startups to diversify revenue streams across commercial and military applications. According to Inc42's comprehensive survey, Hardware/Defence-tech has emerged as the top investment theme for H2 2025 (second half of the year 2025), trailing only artificial intelligence in investor prioritisation.
The existence of tech-driven capabilities, substantial procurement budgets, and the adoption of technology as an agenda establishes a strong foundation for growth.
Several notable success stories include ideaForge's successful Initial Public Offering (IPO), which achieved a 94 percent premium, as well as Paras Defence's public listing. Emerging companies such as AjnaLens and Sagar Defence demonstrate commercial viability despite facing inherent challenges. These challenges include complex procurement processes, the cyclical nature of revenues compared to the venture capitalists' preference for recurring Software as a Service (SaaS) models, long gestation periods, and the risks associated with beta products intended for military applications.. To address these structural impediments, successful defence-tech companies are adopting strategic solutions such as partnering with defence primes following the Helsing-Saab model, maintaining international focus from inception, and developing integrated solutions, such as Grene Robotics' Indrajaal system, rather than standalone components. Strategic acquisitions, including Alpha Design by Adani and Dhaksha by Coromandel, combined with Defence Public Sector Undertakings (PSUs) placing INR 7,572 crore orders on domestic vendors, reflect the growing market needs.
This ecosystem development, supported by initiatives including India-United States (US) Defence Acceleration Ecosystem (INDUS-X) and US–India Initiative on Critical and Emerging Technology (iCET) for access to the US market and mirroring successful models from Israel's Unit 8,200 startup ecosystem and Ukraine's BRAVE1 platform with US$40 million investment and 8x growth in 2024, positions India to leverage private tech innovation for national security needs while creating pathways to becoming a global defence-tech hub by 2047.
Ankit K is an Assistant Professor of International Relations specialising in War, tech and strategy at the Rashtriya Raksha University, MHA.
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Ankit K is New Delhi-based analyst who specialises in the intersection of Warfare and Strategy. He has formerly worked with a Ministry of Home Affairs ...
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