Future of the India Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2022

  • ID: 4342120
  • Report
  • Region: India
  • 157 Pages
  • Strategic Defence Intelligence
1 of 4

FEATURED COMPANIES

  • BAE Systems Plc.
  • Boeing
  • Mazagon Docks Limited
  • Ordnance Factory Board
  • Thales
  • MORE

Summary

India was the world’s top-most importer of military hardware over 2012–2016. The country’s defense equipment imports, which accounted for 13% of global arms imports over 2012–2016, were three times larger than its closest rivals, China and Pakistan. The country mainly relies on imports to meet 70% of its defense requirements, with the remaining 30% being met by domestic companies. However, India is aiming to attain self-reliance by procuring the majority of its defense requirements domestically and programs such as “Make in India” have already been launched by the government.

Although Russia continues to dominate Indian defense equipment imports, India has lately sought to diversify its procurement sources, with a recent focus on the US. During the forecast period, the US, the UK, and Israel are expected to further strengthen their market positions, reducing the market share of other European suppliers such as Germany and France. For example, India signed a US$3 billion deal with the US for procuring 15 CH-47F Chinook heavy-lift helicopters and 22 AH-64E Apache attack helicopters. The Indian MoD also signed a contract of US$107.8 million with the US based Lockheed Martin for procuring pilot night vision sensor (PNVS) systems for Apache helicopters.

Between 2013 and 2017, the Indian defense budget increased at a CAGR of 7.73%, and is expected to increase significantly, at a CAGR of 10.49%, during the forecast period, to reach a value of US$69.1 billion by 2022. Prolonged unresolved border issues and rising tension with two neighboring nations, China and Pakistan, is expected to fuel the defense budget in the coming years; in addition to the country’s need to replace its aging and outdated military hardware and technology.

Under the “Make in India” campaign, launched by the BJP Government and led by the country’s Prime Minister, Narendra Modi, India’s manufacturing capabilities are under process of being enhanced, presenting ample growth opportunities for Indian defense manufactures such as the Tata Group, Hindustan Aeronautics Limited (HAL), Bharat Electronics Limited (BHEL), Mahindra Defence Systems (MDS),and Reliance Defence.

The report “Future of the India Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2022” offers detailed analysis of Indian defense industry with market size forecasts covering the next five years. This report will also analyze factors that influence demand for the industry, key market trends, and challenges faced by industry participants.

In particular, it provides an in-depth analysis of the following -

  • Indian defense industry market size and drivers: Detailed analysis of Indian defense industry during 2018–2022, including highlights of the demand drivers and growth stimulators for the industry. It also provides a snapshot of the country’s expenditure and modernization patterns.
  • Budget allocation and key challenges: Insights into procurement schedules formulated within the country and a breakdown of the defense budget. It also details the key challenges faced by defense market participants within the country.
  • Porter’s Five Force analysis of Indian defense industry: Analysis of the market characteristics by determining the bargaining power of suppliers, bargaining power of buyers, threat of substitution, intensity of rivalry, and barriers to entry.
  • Import and Export Dynamics: Analysis of prevalent trends in the country’s imports and exports over the last five years.
  • Market opportunities: Details of the top five defense investment opportunities over the next 10 years.
  • Competitive landscape and strategic insights: Analysis of the competitive landscape of Indian defense industry. It provides an overview of key players, together with insights such as key alliances, strategic initiatives, and a brief financial analysis.

Companies mentioned in this report: 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) and Goa Shipyard Limited (GSL).

Scope

  • India has a coastline, land frontier, island territories, airspace, and crucial offshore installations to defend against the various potential security threats. As a result, it is highly necessary for the Indian Armed Forces to be prepared to repel any external threat. The Indian Government is therefore continuously focusing on improving the country’s existing defense infrastructure. Only 30% of the defense needs are currently fulfilled by the domestic defense industry and the rest is imported from various countries of the world. The Indian Government has identified the need to build a strong and self-sustaining defense sector as a top priority. This has prompted the Indian MoD to consistently allocate an increasing share of its budget toward the defense sector, a trend that is expected to continue over the forecast period. Historic data shows that India invested US$187.8 billion in the defense sector during 2013-2017, and this is expected to increase to US$285.2 billion over 2018-2022.
  • Historic data shows the average capital expenditure allocation of the total Indian defense budget was averaging 35.8%, and the allocation is expected to decline marginally during the forecast period to an average of 35.3%.
  • The Indian MoD is expected to invest in submarines, multi-role aircrafts, corvettes, tanks, artillery guns, Multi Barrel Rocket Launchers (MBRL), helicopters, submarines, surface-to-air missiles, Unmanned Aerial Vehicles (UAV) and frigates among others.

Reasons to Buy

  • This report will give the user confidence to make the correct business decisions based on a detailed analysis of Indian defense industry market trends for the coming five years
  • The market opportunity section will inform the user about the various military requirements that are expected to generate revenues during the forecast period. The description includes technical specifications, recent orders, and the expected investment pattern by the country during the forecast period
  • Detailed profiles of the top domestic and foreign defense manufacturers with information about their products, alliances, recent contract wins, and financial analysis wherever available. This will provide the user with a total competitive landscape of the sector
  • A deep qualitative analysis of Indian defense industry covering sections including demand drivers, Porter’s Five Forces Analysis, Key Trends and Growth Stimulators, and latest industry contracts
READ MORE
Note: Product cover images may vary from those shown
2 of 4

FEATURED COMPANIES

  • BAE Systems Plc.
  • Boeing
  • Mazagon Docks Limited
  • Ordnance Factory Board
  • Thales
  • MORE

1. Introduction
1.1. What is this Report About?
1.2. Definitions
1.3. Summary Methodology
1.4. About

2. Executive Summary

3. Market Attractiveness and Emerging Opportunities
3.1. Current Market Scenario
3.1.1. Primary threat perception
3.1.2. Military Doctrine & Strategy
3.1.3. Military Fleet Size
3.1.4. Procurement Programs
3.1.4.1 Ongoing procurement programs
3.1.4.2 Future procurement programs
3.1.5. Social, Political and Economic Environment & Support for Defense Projects
3.1.6. Political & Strategic Alliances
3.2. Defense Market Size Historical and Forecast
3.2.1. Indian defense budget expected to be US$285.2 billion cumulatively over 2018-2022
3.2.2. Modernization initiatives, hostile neighbors, territorial disputes, and implementation of OROP and 7th Pay Commission will be the key growth drivers
3.2.3. Defense budget as a percentage of GDP will remain at an average of 1.6% over the forecast period
3.3. Analysis of Defense Budget Allocation
3.3.1. Revenue expenditure expected to increase over the forecast period
3.3.2. Procurement of equipment is expected to pick up over the forecast period
3.3.3. Army continues to see the largest share of the defense budget
3.3.4. Defense ministry will spend US$152.6 billion on its army over the forecast period
3.3.5. Indian MoD projected to spend US$68.2 billion on its air force over the forecast period
3.3.6. Expenditure for the navy expected to grow at a CAGR of 9.85% during 2018-2022
3.3.7. Per capita defense expenditure is expected to increase over the forecast period
3.4. Homeland Security Market Size and Forecast
3.4.1. India is projected to spend US$74.8 billion cumulatively on homeland security over the forecast period
3.4.2. Homeland security is expected to be driven by cross-border terrorism and domestic conflicts
3.4.3. India falls under “highly affected” of terrorism category
3.4.4. India faces high level of threat from foreign terrorist organizations
3.4.5. India has terrorism index score of 7.5
3.5. Benchmarking with Key Global Markets
3.5.1. India’s defense budget expected to grow at a CAGR of 10.49%
3.5.2. The US and China dominate the global defense industry
3.5.3. India allocates a lower share of its GDP to defense than other Asian countries
3.6. Market Opportunities: Key Trends and Growth Stimulators
3.6.1. Multi-role Aircraft
3.6.2. Missile Defense System
3.6.3. Infrastructure Construction

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 2012-2016
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
4.2.3. Naval Vessels accounted for the majority of defense imports during 2012-2016
4.2.3.1 Industry Dynamics
4.3. Five Forces Analysis
4.3.1. Bargaining power of supplier: low to high
4.3.2. Bargaining power of buyer: high
4.3.3. Barrier to entry: medium to high
4.3.4. Intensity of rivalry: high
4.3.5. Threat of substitution: medium to high

5. Market Entry Strategy
5.1. Market Regulation
5.1.1. Defense Procurement Procedure (DPP) - 2016: A significant improvement
5.1.2. Offset policy to drive defense industrial modernization
5.1.3. Main features of revised Defense Procurement Procedure (DPP) - 2016
5.1.4. Private sectors permitted to produce arms and ammunition under the new Draft Arms and Ammunitions Manufacturing Policy (DAAM)
5.1.5. Foreign direct investment (FDI) increased to 49% in the Indian defense sector
5.2. Market Entry Route
5.2.1. Budgeting Process
5.2.2. Procurement Policy & Process
5.2.3. Foreign OEMs are forming joint ventures in order to enter the market
5.2.4. India emerges as a key outsourcing hub for global defense companies
5.3. Key Challenges
5.3.1. Offset policy is biased towards the domestic public and private sectors
5.3.2. Insufficient information and transparency on future plans
5.3.3. Bureaucracy, corruption, and long project delays
5.3.4. Developing advanced low-cost solutions is essential to gain market share

6. Competitive landscape and Strategic Insights
6.1. Competitive landscape Overview
6.1.1. Domestic public companies have a strong presence in the Indian defense industry
6.2. Key Foreign Companies
6.2.1. Lockheed Martin Corporation - overview
6.2.2. Lockheed Martin Corporation - main products
6.2.3. Lockheed Martin Corporation - recent announcements and strategic initiatives
6.2.4. Lockheed Martin Corporation - alliances
6.2.5. Lockheed Martin Corporation - recent contract wins
6.2.6. BAE Systems Plc. - overview
6.2.7. BAE Systems Plc. - main products
6.2.8. BAE Systems Plc. - recent announcements and strategic initiatives
6.2.9. BAE Systems Plc. - alliances
6.2.10. BAE Systems Plc. - recent contract wins
6.2.11. Thales - overview
6.2.12. Thales - main products
6.2.13. Thales - recent announcements and strategic initiatives
6.2.14. Thales - alliances
6.2.15. Thales - recent contract wins
6.2.16. Boeing - overview
6.2.17. Boeing - main products
6.2.18. Boeing - recent announcements and strategic initiatives
6.2.19. Boeing - alliances
6.2.20. Boeing - recent contract wins
6.3. Key Public Sector Companies
6.3.1. Mazagon Docks Limited - overview
6.3.2. Mazagon Docks Limited - main products
6.3.3. Mazagon Docks Limited - recent announcements and strategic initiatives
6.3.4. Mazagon Docks Limited - alliances
6.3.5. Mazagon Docks Limited - recent contract wins
6.3.6. Hindustan Aeronautics Limited - overview
6.3.7. Hindustan Aeronautics Limited - main products and services
6.3.8. Hindustan Aeronautics Limited - recent announcements and strategic initiatives
6.3.9. Hindustan Aeronautics Limited - alliances
6.3.10. Hindustan Aeronautics Limited - recent contract wins
6.3.11. Bharat Electronics Limited - overview
6.3.12. Bharat Electronics Limited - main products and services
6.3.13. Bharat Electronics Limited - recent announcements and strategic initiatives
6.3.14. Bharat Electronics Limited - alliances
6.3.15. Bharat Electronics Limited - recent contract wins
6.3.16. Bharat Electronics Limited - Financial analysis
6.3.17. Bharat Dynamics Limited - overview
6.3.18. Bharat Dynamics Limited - main products
6.3.19. Bharat Dynamics Limited - recent announcements and strategic initiatives
6.3.20. Bharat Dynamics Limited - alliances
6.3.21. Bharat Dynamics Limited - recent contract wins
6.3.22. Ordnance Factory Board - overview
6.3.23. Ordinance Factory Board - main products
6.3.24. Ordinance Factory Board - recent announcements and strategic initiatives
6.3.25. Ordinance Factory Board - alliances
6.3.26. Ordinance Factory Board - recent contract wins
6.3.27. BEML - overview
6.3.28. BEML - main products
6.3.29. BEML - recent announcements and strategic initiatives
6.3.30. BEML - alliances
6.3.31. Goa Shipyard Limited - overview
6.3.32. Goa Shipyard Limited - main products and services
6.3.33. Goa Shipyard Limited - recent announcements and strategic initiatives
6.3.34. Goa Shipyard Limited - alliances
6.3.35. Goa Shipyard Limited - recent contract wins
6.4. Key Private Sector Companies
6.4.1. Tata Advanced Systems Limited - overview
6.4.2. Tata Advanced Systems Limited - main products
6.4.3. Tata Advanced Systems Limited - recent announcements and strategic initiatives
6.4.4. Tata Advanced Systems Limited - alliances
6.4.5. Tata Advanced Systems Limited - recent contract wins
6.4.6. Mahindra Defence Systems - overview
6.4.7. Mahindra Defence Systems - main
6.4.8. Mahindra Defence Systems - recent announcements and strategic initiatives
6.4.9. Mahindra Defence Systems - alliances

7. Business Environment and Country Risk
7.1. Economic Performance
7.1.1. GDP Per Capita, US$
7.1.2. GDP (current US$ Billion)
7.1.3. Exports of goods and services (current LCU Billion)
7.1.4. Imports of goods and services (current LCU Billion)
7.1.5. Gross National Disposable Income (US$ Billion)
7.1.6. LCU per USD (period average)
7.1.7. Market Capitalization of Listed Companies (US$ Billion)
7.1.8. Market Capitalization of Listed Companies (% of GDP)
7.1.9. Total Government cash surplus/deficit as % of GDP (LCU)
7.1.10. Goods exports as a percentage of GDP
7.1.11. Goods imports as a percentage of GDP
7.1.12. Services imports as a percentage of GDP
7.1.13. Services Exports as a percentage of GDP
7.1.14. Foreign direct investment, net (BoP, current US$ Bn)
7.1.15. Net foreign direct investment as % of GDP
7.1.16. Mining, Manufacturing, and Utilities Output (US$ Bn)

8. Appendix
8.1. About
8.2. Disclaimer

List of Tables

Table 1: The Indian Army Strength
Table 2: Indian Navy Strength
Table 3: Indian Air Force Strength
Table 4: India - Ongoing Procurement Programs
Table 5: India - Future Procurement Programs
Table 6: Indian Defense Expenditure (INR Billion & US$ Billion), 2013-2022
Table 7: Indian GDP Growth vs. Defense Expenditure as Percentage of GDP Growth, 2013-2022
Table 8: Indian Defense Budget Split Between Capital and Revenue Expenditure (%), 2013-2022
Table 9: Indian Capital Expenditure (INR billion & US$ billion), 2013-2022
Table 10: Indian Defense Budget Split (%), 2013-2022
Table 11: Indian Army Expenditure (INR billion & US$ billion), 2013-2022
Table 12: Indian Air Force Expenditure (INR billion & US$ billion), 2013-2022
Table 13: Indian Navy Expenditure (INR billion & US$ billion), 2013-2022
Table 14: Indian Per Capita Defense Expenditure (US$), 2013-2022
Table 15: Indian Homeland Security Budget (INR billion & US$ billion), 2013-2022
Table 16: Terrorism Index, 2017
Table 17: Benchmarking with Key Markets - 2013-2017 vs. 2018-2022
Table 18: Offset Policy in India
Table 19: Indian Budget Formation Timetable:
Table 20: Market Entry Strategies and Key Objectives of Foreign Companies in the Indian Defense Sector
Table 21: Key Players and their Operations in the Indian Defense Industry
Table 22: Scale of Operations of Domestic Public &Private Sector Companies in the Indian Defense Industry
Table 23: Lockheed Martin Corporation - Main Products
Table 24: Lockheed Martin Corporation - Alliances
Table 25: Lockheed Martin Corporation - Recent Contract Wins
Table 26: BAE Systems Plc. - Main Products
Table 27: BAE Systems Plc. - Alliances
Table 28: BAE Systems Plc. - Recent Contract Wins
Table 29: Thales - Main Products
Table 30: Thales - Alliances
Table 31: Thales - Recent Contract Wins
Table 32: Boeing - Main Products
Table 33: Boeing - Alliances
Table 34: Boeing - Recent Contract Wins
Table 35: Mazagon Docks Limited - Main Products
Table 36: Mazagon Docks Limited - Alliances
Table 37: Mazagon Docks Limited - Recent Contract Wins
Table 38: Hindustan Aeronautics Limited - Main Products and Services
Table 39: Hindustan Aeronautics Limited - Alliances
Table 40: Hindustan Aeronautics Limited - Recent Contract Wins
Table 41: Bharat Electronics Limited - Major Products and Services
Table 42: Bharat Electronics Limited - Alliances
Table 43: Bharat Electronics Limited - Recent Contract Wins
Table 44: Bharat Dynamics Limited - Main Products
Table 45: Bharat Dynamics Limited - Alliances
Table 46: Bharat Dynamics Limited - Recent Contract Wins
Table 47: Ordinance Factory Board - Main Products
Table 48: Ordinance Factory Board - Alliances
Table 49: Ordinance Factory Board - Recent Contract Wins
Table 50: BEML - Main Products
Table 51: BEML - Alliances
Table 52: Goa Shipyard Limited - Main Products and Services
Table 53: Goa Shipyard Limited - Alliances
Table 54: Goa Shipyard Limited - Recent Contract Wins
Table 55: Tata Advanced Systems Limited - Main Products
Table 56: Tata Advanced Systems Limited - Alliances
Table 57: Tata Advanced Systems Limited - Recent Contract Wins
Table 58: Mahindra Defence Systems - Main Products
Table 59: Mahindra Defence Systems - Alliances

List of Figures

Figure 1: Indian Defense Expenditure (INR Billion), 2013-2022
Figure 2: Indian Defense Expenditure (US$ Billion), 2013-2022
Figure 3: Indian GDP Growth vs. Defense Expenditure as Percentage of GDP Growth, 2013-2022
Figure 4:Indian Defense Budget Split Between Capital and Revenue Expenditure (%),2013-2022
Figure 5: Indian Capital Expenditure (INR billion), 2013-2022
Figure 6: Indian Capital Expenditure (US$ billion), 2013-2022
Figure 7: Indian Defense Budget Split (%), 2013-2022
Figure 8: Indian Defense Expenditure for the army (INR Billion), 2013-2022
Figure 9: Indian Defense Expenditure for the army (US$ Billion), 2013-2022
Figure 10: Indian Defense Expenditure for the air force (INR Billion), 2013-2022
Figure 11: Indian Defense Expenditure for the air force (US$ Billion), 2013-2022
Figure 12: Indian Defense Expenditure for the Navy (INR Billion), 2013-2022
Figure 13: Indian Defense Expenditure for the Navy (US$ Billion), 2013-2022
Figure 14: Indian Per Capita Defense Expenditure (US$), 2013-2022
Figure 15: Indian Homeland Security Budget (INR billion), 2013-2022
Figure 16: Indian Homeland Security Budget (US$ billion), 2013-2022
Figure 17: Terrorism Heat Map, 2017
Figure 18: Terrorism Index
Figure 19: Benchmarking with Key Markets - 2013-2017 vs. 2018-2022
Figure 20: Defense Expenditure of the World’s Largest Military Spenders (US$ Billion), 2017 and 2022
Figure 21: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2017
Figure 22: Multi-role Aircraft Market Size (US$ Billion), 2017-2027
Figure 23: Missile Defense System Market Size (US$ Billion), 2017-2027
Figure 24: Infrastructure Construction Market Size (US$ Million), 2017-2027
Figure 25: Indian Defense Import Trend (US$ Million), 2012-2016 (TIV values*)
Figure 26: Country-wise Break-up of Indian Defense Imports (%), 2012-2016 (TIV values*)
Figure 27: Weapon Category Break-up of Indian Defense Imports (%), 2012-2016 (TIV values*)
Figure 28: Indian Defense Export Trend (US$ Million), 2012-2016 (TIV values*)
Figure 29: Country-wise Break-up of Indian Defense Exports (%), 2012-2016 (TIV values*)
Figure 30: Weapon Category Break-up of Indian Defense Exports (%), 2012-2016 (TIV values*)
Figure 31: Industry Dynamics - Porter’s Five Forces Analysis
Figure 32: Bharat Electronics Limited - Revenue Trend Analysis (INR Billion), 2012-2016
Figure 33: Bharat Electronics Limited - Operating Profit Trend Analysis (INR Billion), 2012-2016
Figure 34: Bharat Electronics Limited - Net Profit Trend Analysis (INR Billion), 2012-2016
Figure 35: GDP Per Capita in US$, 2015-2025
Figure 36: GDP (current US$ billion), 2015-2025
Figure 37: Exports of goods and services (current LCU Billion), 2005-2014
Figure 38: Imports of goods and services (current LCU Billion), 2005-2014
Figure 39: Gross National Disposable Income (US$ Billion), 2005-2012
Figure 40: LCU per USD (period average), 2015-2024
Figure 41: Market Capitalization of Listed Companies (US$ Bn) , 2005-2012
Figure 42: Market Capitalization of Listed Companies (% of GDP),2005-2012
Figure 43: Total Government Cash Surplus/Deficit as % of GDP (LCU), 2005-2012
Figure 44: Goods exports as a percentage of GDP,2005-2014
Figure 45: Goods imports as a percentage of GDP,2005-2014
Figure 46: Service imports as a percentage of GDP, 2005-2014
Figure 47: Services exports as a percentage of GDP,2005-2014
Figure 48: Foreign direct investment, net (BoP, current US$ Bn), 2005-2014
Figure 49: Net foreign direct investment as % of GDP, 2005-2014
Figure 50: Mining, Manufacturing, Utilities Output (US$ Bn), 2005-2014

Note: Product cover images may vary from those shown
3 of 4

Loading
LOADING...

4 of 4
  • BAE Systems Plc.
  • Bharat Dynamics Limited (BDL)
  • Bharat Earth Movers Limited (BEML)
  • Bharat Electronics Limited (BEL)
  • Boeing
  • Goa Shipyard Limited (GSL)
  • Hindustan Aeronautics Limited (HAL)
  • Lockheed Martin Corporation
  • Mazagon Docks Limited
  • Ordnance Factory Board
  • Thales
Note: Product cover images may vary from those shown
5 of 4
Note: Product cover images may vary from those shown
Adroll
adroll