India: Second Largest Arms Importer, SIPRI Report Reveals

India: Second Largest Arms Importer, SIPRI Report Reveals

Why in News?
According to the Stockholm International Peace Research Institute (SIPRI) report, India's share of global arms imports has decreased to 8.3% between 2020 and 2024, making it the second-largest arms importer globally, following Ukraine.

Key Findings from the Report on Global Arms Trade:

• India:
  India’s arms imports have decreased by 9.3% compared to the 2015-19 period. Russia remains India’s primary supplier, but its share has dropped from 72% (2010-14) to 36% (2020-24).
  France has emerged as India’s second-largest supplier, accounting for 28% of its total arms imports.

• India’s Neighbors:
  Pakistan's arms imports have increased by 61%, with China supplying 81% of Pakistan’s arms.
  For the first time since 1990-94, China has fallen out of the top 10 arms importers, with a 64% decline in its arms imports, signaling the growth of its domestic defense industry.

• Regional Insights:
  India, Pakistan, Japan, and Australia are among the top 10 largest arms importers in the 2020-24 period.
  The United States remains the largest arms exporter, supplying weapons to Ukraine, NATO allies, and Asia-Pacific nations.
  Europe saw a 155% increase in arms imports, particularly due to defense spending spurred by Russia's invasion of Ukraine.
  France has overtaken Russia as the second-largest arms exporter, with India being its top buyer, followed by Qatar.

• Other Global Insights:
  Ukraine’s arms imports increased by 100-fold due to the war with Russia, receiving 8.8% of global arms imports, with the U.S., Germany, and Poland being its main suppliers.
  Russia's arms exports fell by 64%, dropping to 7.8% of global exports, primarily due to Western sanctions and production limitations.
  In the Middle East, arms imports decreased by 20%, but the region still remains a major arms importer, with Qatar becoming the third-largest arms importer globally.

• Global Arms Transfers:
  Overall global arms transfers have remained stable compared to previous periods but have increased by 18% since 2005–09, with a rise in imports from Europe and the Americas, counterbalanced by a decline in regions like China.

India’s Initiatives to Reduce Arms Imports:

• Budget:
  The 2024-25 defense budget allocates Rs 6.21 lakh crore, with 75% of capital procurement reserved for domestic manufacturers.

• Self-Reliant Initiatives:
  The SRIJAN portal was launched to promote procurement from Indian vendors, encouraging self-reliance in defense manufacturing.

• Production Growth:
  India’s defense production reached Rs 1.27 lakh crore in 2023-24, a 174% increase from 2014-15. The U.S., France, and Armenia are the top three destinations for India’s defense exports.

• Positive Indigenization Lists:
  Five lists of defense items have been released, prohibiting the import of these items, ensuring they are manufactured domestically.

• Defense Acquisition Procedure (DAP) 2020:
  This procedure emphasizes domestic procurement over foreign purchases and introduces categories like “Buy (Indian-IDDM)” (Indigenously Designed, Developed, and Manufactured). It promotes Make-I and Make-II projects to encourage private-sector participation.

• Defense Industrial Corridors (DICs):
  Two corridors have been set up in Uttar Pradesh and Tamil Nadu to boost defense manufacturing capabilities.

• Private Sector & FDI Participation:
  The defense sector has seen 74% Foreign Direct Investment (FDI) via the Automatic Route and 100% via the Government Route. The private sector now accounts for 21% of India’s total defense production.

• Defense Public Sector Units (DPSUs):
  India has 16 DPSUs, such as Hindustan Aeronautics Limited (HAL), Bharat Electronics Ltd (BEL), and Mazagon Dock Shipbuilders. Major projects include the indigenous aircraft carrier INS Vikrant and the LCA Tejas fighter jet.

• R&D & Innovation:
  The iDEX initiative promotes innovation in defense technologies through startups and MSMEs.

Future Goals: India aims to achieve Rs 1.75 lakh crore in defense production by 2025, with a target of Rs 3 lakh crore by 2029.

Drishti Mains Question: Critically analyze the government’s initiatives to boost domestic defense manufacturing in light of India’s significant growth in defense production.

Previous Year UPSC Mains Question: Foreign Direct Investment (FDI) in the defense sector is being liberalized. What impact is this expected to have on India’s defense sector and economy, both in the short and long term? (2014)

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