Can India’s Defence Sector Boom Benefit Your Portfolio?

India’s defence sector has changed in a big way over the last decade, and recent numbers show just how much. In the financial year 2023-24, defence production reached a record ₹1.27 lakh crore, a 174% jump from ₹46,429 crore in 2014-15. This growth comes from strong government support and the Make in India push, which has helped both public and private companies make more advanced military equipment at home. According to the ministry, 65% of defence equipment is now manufactured domestically, a significant shift from the earlier 65-70% import dependency, showcasing India’s self-reliance in defence. The country is now less dependent on foreign suppliers and is building its own strength through local manufacturing. 

Defence exports have also hit new highs, reaching ₹23,622 crore in 2024-25, up from just ₹686 crore in 2013-14. That is a 34x increase in about ten years. India now sells defence products to over 100 countries, with the USA, France, and Armenia among the top buyers. The range of exports includes bulletproof jackets, aircraft, helicopters, boats, and torpedoes. The private sector is playing a bigger role, with exports from private companies and DPSUs both growing fast. 

For investors, the sector looks promising, and recent events have added momentum. After India’s show of military prowess through Operation Sindoor in May 2025, the Nifty India Defence Index rose over 22% in less than three weeks, outpacing the Nifty 50’s 1.1% gain. The sector’s strong performance is not just short-term; the Nifty India Defence Index has delivered 28% returns over the past year and a staggering 466% over three years. The government signed 193 contracts worth over ₹2 lakh crore in 2024-25, and 92% of these went to domestic companies. With ambitious targets for production and exports, and a clear commitment to self-reliance, defence is now a space where both long-term growth and stability are possible for investors.