India has the third-largest armed forces in the world. It’s defence market is among the most attractive globally and the Indian government is keen to leverage this advantage to promote investments in the sector. India ranks among the top 10 countries in the world in terms of its military expenditure and import of defence equipment. It allocates about 1.96% of its GDP to defence spending, of which 40% is assigned to capital acquisitions. However, only about 30% of defence equipment is manufactured in India, mainly by public sector undertakings, and the remaining about 70% of its defence requirements are met through imports. Moreover, even when defence products are manufactured domestically, there is a large import component of raw material at both the system and sub-system levels. The Indian defence industry’s import-export ratio is inferior to countries with a much smaller defence industrial base. Between 2006 and 2010, India surpassed China as the world’s largest importer of weapons systems, reflecting the nation’s intent to modernize its armed forces and replace obsolete equipment. India’s arms imports are now almost three times as high as those of the second and third largest arms importers in the world- China and Pakistan.

The Indian defence industry is dominated by defence public sector undertakings (DPSU’s) and ordnance factories which contribute about 90% of the total domestic manufacturing output. The 41 ordnance factories are spread across 26 different locations and employ close to 1,25,000 people. These factories manufacture a wide spectrum of products from weapons (small caliber, mortar equipment, medium caliber and large caliber), ammunition (small, medium and large caliber, mortar bombs, grenades, signalling smoke, rocket bombs, demolition, explosives, propellants and chemicals), vehicles (armored and transport), clothing, general stores and equipment for the defence services. Combined, the DPSU’s and ordnance factories have played a critical role in building a domestic industrial base in this sector as they typically outsource 20-25% of their production requirements to private companies. In addition to public undertakings, there is a small but growing number of medium large private companies that have already entered, or, are seriously evaluating entry into the market.

India’s defence spending has grown tremendously at a compounded annual growth rate (CAGR) of 7.58% and the defence expenditure of the government accounts for about 13% of its total expenditure. The government opened the defence sector to private and foreign investment in 2001 and has also made transparent global bidding guidelines in the Defence Procurement Procedure (DPP), which is revised annually.

Key features of the DPP include:
Buy (Global): Outright purchase of equipment from a foreign vendor.
Buy (Indian): Outright purchase of equipment from Indian vendor with minimum local content of 30%.
Buy and Make (Global): Purchase from a foreign vendor followed by licensed domestic manufacture through transfer of technology.
Buy and Make (Indian): Purchase from an Indian company/Indian joint venture with minimum local content of 50%.
Make: Indigenous design, development and production of equipment.

Over the years through our successful business operations, and our credibility and competence in the marketplace, we at Zorya Systems and Technologies have attracted a select and consolidated list of overseas clients each of whom have established and maintained worldwide leading positions in the defence industry. With the help of our consulting and exclusive representative service, our international clients have been able to secure several defence contracts with the Government of India as well as with certain domestic private enterprises. As their exclusive representative we have undertaken and successfully completed various defence projects involving direct purchases and imports, transfer of technology, joint ventures, and foreign direct investments (FDI’s).

Our recent successful projects, on behalf of our clients, have been in the following areas of defence:
01. Communications, Command and Control Systems for Military
02. Body Armor for Military
03. Radar Systems
04. Optoelectronic Systems for Military
05. Unmanned Aircraft Systems
06. Battlefield Management Systems
07. Surveillance and Security Systems for Military installations
08. Armored Vehicles for Military