Why is India an attractive defence market for global companies?

India is one of the largest defence spenders globally with increasing budgets, strong policy support for domestic manufacturing, and rising demand for advanced defence technologies.

What is driving growth in India’s defence sector?

Growth is driven by rising geopolitical tensions, modernization of armed forces, increased defence budgets, and policies promoting indigenisation and private sector participation.

What is the size of the Indian defence market?

India’s defence market was valued at over USD 30 billion in 2025 and is expected to grow steadily with strong government spending and domestic procurement mandates.

What is the role of indigenisation in India’s defence strategy?

Indigenisation is central to India’s defence strategy, with policies mandating a high percentage of procurement from domestic manufacturers to reduce import dependency.

Which sectors offer the most opportunities in India’s defence market?

Key opportunity areas include defence electronics, aerospace, drones, naval systems, cybersecurity, and advanced materials.

How can global defence companies enter the Indian market?

Companies can enter through joint ventures, technology partnerships, local manufacturing, and collaboration with Indian private and public sector players.

What is the importance of defence exports in India?

Defence exports are growing rapidly, positioning India as an emerging global supplier of military equipment and strengthening its defence industrial base.

What is India’s GDP growth outlook for 2025–26?

India’s GDP is projected to grow between 7.4% and 7.8% in FY 2025–26, making it one of the fastest-growing major economies globally.

What are the key drivers of India’s economic growth?

Growth is driven by strong domestic demand, private consumption, government capital expenditure, and expansion in services and manufacturing sectors.

What reforms are shaping India’s economy?

Key reforms include GST rationalisation, tax incentives, trade agreements, and policies supporting manufacturing, digital economy, and infrastructure development.

What opportunities does India offer foreign investors?

India offers opportunities in manufacturing, technology, infrastructure, renewable energy, and consumer markets, supported by strong demand and policy support.

How important is domestic demand in India’s growth model?

Domestic demand is the primary growth driver, with private consumption accounting for over 60% of GDP and providing resilience against global shocks.

What are the risks to India’s economic outlook?

Key risks include global economic uncertainty, geopolitical tensions, energy price volatility, and external trade disruptions.

Why is India considered a priority market for global companies?

India’s large domestic market, strong growth trajectory, improving ease of doing business, and policy reforms make it a key destination for long-term investment.

How could India’s defence industrial base evolve over the next decade?

India is gradually shifting from being primarily a defence importer to becoming a designer, manufacturer and exporter of advanced defence technologies. Continued investment in domestic research, industrial partnerships and export initiatives is expected to significantly expand India’s defence manufacturing ecosystem over the next decade.

Which areas of defence technology present the strongest collaboration opportunities with Indian partners?

High potential collaboration areas include radar and electronic warfare systems, advanced sensors, propulsion technologies, secure communications and unmanned systems. These segments align closely with India’s modernisation priorities and often require specialised expertise from global defence technology firms.

What entry strategies are most effective for foreign defence companies in India?

Foreign defence companies typically succeed in India by combining local partnerships with phased localisation of manufacturing and engineering. Joint ventures, co-development programmes and supplier integration into Indian defence supply chains allow companies to build long term credibility while meeting indigenous content requirements.

What structural challenges should defence companies consider before entering India?

Companies entering India’s defence sector should consider factors such as procurement timelines, evolving localisation policies and the complexity of coordinating with multiple stakeholders across government and industry. Long term engagement and early alignment with procurement frameworks are often critical for successful market entry.

How does India’s DPDP Act affect businesses handling personal data?

India’s Digital Personal Data Protection Act introduces a consent-based framework requiring businesses to obtain clear permission before processing personal data. Companies must implement data security safeguards, enable individuals to exercise their rights over personal information, and establish procedures for reporting data breaches and handling compliance obligations.

Does the DPDP Act apply to foreign companies serving Indian users?

Yes. The DPDP Act applies to any organisation that processes the personal data of individuals located in India, even if the company itself is based outside the country. This means European and international companies offering digital services, platforms, or products to Indian users must comply with the law’s consent, data protection, and governance requirements.

What practical steps should companies take to comply with the DPDP Act?

Businesses should begin by mapping the personal data they collect and identifying how it is processed across systems and partners. They should then implement clear consent mechanisms, update privacy policies, define processes for responding to user data requests, and establish internal controls for breach notification and data protection governance.

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Trade & Industry Advisory | Market Study

Gitta Perez, Director, Middle East & India (Region Head), Business Finland

Kasvu Consulting delivered an outstanding market study for Business Finland identifying opportunities for Finnish defence companies in India. Combining rigorous qualitative and quantitative research, and market intelligence through interviews with industry leaders, the study provided practical, reliable insights into India’s evolving defence ecosystem. Kasvu also presented the findings through a highly effective webinar, translating the research into actionable guidance for Finnish defence manufacturers exploring the Indian market.

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Merit Fimberg-Espuch, Project Manager, Estonian Chamber of Commerce and Industry I Estonia

Kasvu Consulting provided outstanding support in organising our Estonian business delegation to India in June 2024. The programme was delivered with meticulous planning, seamless logistics, and strong on-ground coordination. Their ability to bridge Estonian and Indian business cultures enabled productive interactions, creating valuable engagement opportunities with Indian counterparts. We highly appreciate Kasvu Consulting’s dedication and would gladly collaborate again.

Strategic Market Intelligence | Market Entry

Volker Friedrich, CEO, GBP International I Germany

Kasvu Consulting delivered an exceptionally rigorous Market Research & Feasibility Report for our German client evaluating expansion into India’s pharmaceutical packaging machinery sector. Combining deep analysis with extensive primary interviews, the study provided credible insights on market dynamics, investment potential, and acquisition opportunities, translating complex intelligence into clear strategic recommendations for evaluating India within the client’s long-term growth strategy.

Defence Market Access | India

Senior Executive, Leading European Dual-Use Defence Equipment Manufacturer I Finland

Kasvu Consulting supported our entry into the highly competitive Indian defence market with exceptional professionalism and strategic insight. Their deep understanding of Finnish-Indian trade dynamics and the defence procurement landscape enabled engagement with key stakeholders across military headquarters and decision-makers. Their structured approach, cross-cultural negotiation capability and extensive industry network opened doors that would have taken us years to access independently.

Strategic Partnership & Market Entry | India

Senior Executive, Finnish Early Education Technology Company I Finland

Kasvu Consulting provided invaluable support as we entered India’s early education market. They carefully analysed our Finnish pedagogical model, mapped it to India’s education ecosystem, and identified suitable partners. Their guidance through negotiations and cross-cultural insights enabled us to secure a strategic partnership aligned with our long-term goals. We strongly recommend Kasvu Consulting to Nordic companies exploring opportunities in India’s education sector.

Cross Cultural Advisory | India

Hanna Karpua, Project Manager, Lapland University of Applied Sciences I Finland

Kasvu Consulting provided an excellent cross cultural training programme for Lapland University of Applied Sciences, helping prepare Indian students and Finnish faculty for a smooth transition to Finland. The training, delivered by Mr. Pawan Bhatnagar, was thoughtfully tailored to address cross cultural contexts and the practical challenges while adapting to Finnish academic and social environments. The sessions were engaging, relevant, and highly customised to our requirements. We look forward to further collaboration with Kasvu Consulting.

India Market Insights

Opportunities, Analysis and Recommendations

15/12/2025

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