New DRDO Policy Aims To Supercharge Private Defence Industry

Opening opportunities for MSMEs and startups, DRDO’s revamped ToT policy targets private participation in defence projects worth over ₹1 trillion.

The Defence Research and Development Organisation (DRDO) has introduced a new Transfer of Technology (ToT) policy to significantly expand private sector participation in defence manufacturing. 

The policy marks a shift from DRDO’s traditional reliance on public sector undertakings, offering dedicated support measures for Micro, Small, and Medium Enterprises (MSMEs) and startups.

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Part of the Modi government’s broader strategy to enhance indigenous manufacturing, the policy seeks to make DRDO-developed technologies more accessible to industry players. So far, DRDO has signed over 2,100 Licensing Agreements for ToT, with 256 granted in 2024 alone, reflecting growing industry interest.

The policy rollout comes as the Defence Acquisition Council (DAC) has accorded Acceptance of Necessity (AoN) for tri-service defence proposals worth ₹1.1 trillion this year. These projects will cover the Army, Navy, and Air Force, focusing on equipment built from DRDO’s innovations.

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In total, more than ₹5.75 trillion worth of proposals have received DAC approval, underscoring the government’s push to transform India into a self-reliant defence manufacturing hub under the “Atmanirbhar Bharat” vision.

By opening the door wider for MSMEs and startups, the DRDO’s new approach is expected to accelerate technology adoption, improve production timelines, and strengthen India’s defence industrial base. This move is seen as a crucial step in fostering innovation, reducing import dependence, and enabling the private sector to play a larger role in meeting the country’s requirements.

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Vidushi Saxena
Vidushi Saxena
Vidushi Saxena is a Journalist at EFY, with a strong interest in news reporting, in-depth research, and developments shaping the business and technology landscape.

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