Privatisation of India's Defense Industry and the Dangers Ahead

What I present here is not an argument against involving India's private industry in the design, development and manufacturing of weapons and ammunition. Rather, it is a forewarning about the potential dangers that may arise if India proceeds down this path without adequate safeguards.

Since independence, India's armed forces have been heavily reliant on imports to meet their requirements for arms and ammunition. India has also endeavoured to develop a domestic arms industry to achieve self-reliance in this domain. This industry has been predominantly government-owned, with minimal participation from the private sector. However, since the economic reforms of 1991 and the subsequent growth of India's private sector, there have been increasing demands to enhance its role in meeting the country's arms requirements. This demand stems primarily from the inability of government-owned defence public sector undertakings (PSUs) to design, develop, and produce cutting-edge military equipment for the armed forces in a timely manner. As a result, the Indian Army, Navy, and Air Force have often been compelled to rely on imported weapons, which are generally of higher quality and more reliable than domestically produced alternatives.

Giving the domestic private sector a greater role in designing and producing India's defence requirements offers several advantages:

• It reduces India's dependence on other countries for its national security needs.

• It helps lower the import bill, thereby easing pressure on foreign exchange reserves.

• It creates more employment opportunities for Indian citizens.

• Technologies developed for the defence industry can also have valuable civilian applications.

Considering the aforementioned points, it may seem obvious that involving the private sector in fulfilling the needs of India's armed forces is entirely beneficial. However, a closer examination of how similar shifts have influenced policies in other countries reveals a more complex—and potentially troubling—picture.

Public sector companies in India engaged in the production of arms and ammunition have historically had a single overarching objective: to meet the requirements of the Indian armed forces. In contrast, private companies around the world typically operate with a different primary motive—profit.

During the initial phase of defence privatisation, India’s private companies will begin earning profits by designing and producing arms for the armed forces. However, India’s defence requirements are not unlimited. Unlike public sector units, private companies operate with a fundamental objective—to generate increasing profits year after year to satisfy their shareholders.

This relentless drive for profit will inevitably push these companies to seek export markets for their products—products which are designed to kill. They will begin lobbying foreign governments to buy their weapons, and the implications of this can be far-reaching and deeply concerning.

• These companies may start lobbying foreign governments aggressively in order to secure international arms deals.

• Over time, they may come to view conflicts abroad not as humanitarian crises, but as opportunities for financial gain. This dangerous mindset could lead them to use their economic influence to shape India's foreign policy in ways that encourage or prolong international conflicts.

• As their financial prowess grows, these companies could begin influencing domestic politics, potentially manipulating elections to install parties that serve their business interests. In a country like India—where institutional checks and balances can sometimes be bypassed—this poses a serious threat to democratic governance.

A case in point is how American defence companies profit from the wars the United States becomes involved in—and how these profits, in turn, influence U.S. foreign policy. This dynamic has long raised concerns about the entanglement of economic interests with matters of war and peace. It is worth recalling the warning issued by former U.S. President Dwight D. Eisenhower in his farewell address: 'In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military–industrial complex.' His words remain a powerful reminder of the risks posed when defence profiteering begins to shape national policy.

The people of India must remain vigilant. While these dangers may not seem immediate, the long-term consequences could be deeply damaging to our democracy. If left unchecked, a nation that once championed non-violence could become one that promotes conflict for profit. We must ensure that the pursuit of economic gain does not come at the cost of our values, our sovereignty, or our commitment to peace.