Resilient Defense Supply Chains vital to achieve the goal of Viksit Bharat 2047: NITI Aayog Paper

Posted 20 May 2025

2 min read

In recent years, geopolitical tensions, global supply chain crises, and cybersecurity threats have highlighted the vulnerabilities of defense logistics.

An infographic titled "Strategic Challenges and Vulnerabilities in Defence Supply Chains" with four illustrated sections: Import Dependence and Geopolitical risks: Icon of a globe with a person and flags. Text: "Defence supply chains rely on foreign suppliers for critical defence components. This may be disrupted due to geopolitical tensions, trade embargoes etc." Cybersecurity Threats: Icon of a shield with a warning symbol. Text: "Supply chain sabotage through cyber espionage, data breaches etc. may compromise sensitive military information." Modernization Challenges: Icon of a lightbulb with gears. Text: "Rapid advancements in defence technologies result in technological obsolescence, impacting operational efficiency." Others: Icon of a money bag with a checklist. Text: "Inefficient procurement policy and inventory management, financial and budget constraints, environmental challenges, lack of human capital development and skilling etc."

The Paper suggests reforms to mitigate vulnerabilities in the defense supply chain and achieve indigenous defense production targets of ₹3 lakh crore by 2029.

Status of Defense Production in India:

Indigenous Defence Production: India's annual defence production stood at ₹1,27,000 crore in 2023-24, an increase of 174% from 2014-15.
Defense Export: Surged to an all-time high of over 23,000 crore rupees in 2024-25.
Private Sector Participation: The private sector contributed Rs 15,233 crore in defence exports of 2024-25.

Policy Recommendations

Public-private partnerships (PPPs):
- Outsourcing Repairs and Maintenance, Public-Private Collaboration in R&D
- Government-Owned, Corporate-Operated (Go-Co) Model (private companies to use defence land for industrial purposes)
- Incentivising MSMEs, Streamlining Procurement and reducing regulatory delays.
Cybersecurity strategies:
- Creating Blockchain-Based Security Frameworks based on national-level blockchain security standards for defence supply chains.
- Introducing cybersecurity audits, centralized threat intelligence platforms, smart contracts in procurement, etc.
Legal and Policy Reforms: Defence laws can be amended to bolster domestic manufacturing, enhance cybersecurity, and address geopolitical risks. E.g. Defence of India Act (1962)
International defence cooperation: Strengthened through technology transfers, strategic alliances (E.g. US, Russia, Israel), strategic supplier diversification etc.