The Emerging Military Startup Complex in India

India being the world’s second-largest country in terms of population boasts one of the largest armies and overall armed forces in the world. According to the Global Firepower Index 2021, India is the fourth most powerful nation in the world in terms of military capabilities.

As such, this large military organization would require an immense amount of equipment and hardware, and unlike countries like the US, Russia, or China for that matter, India lacks a robust defence-related military-industrial complex that would be capable of suppling and fulfilling the necessities of the armed forces. As such most defence acquisitions are dependent on imports from other countries. Not only does this mean that the military must be satisfied with foreign equipment but also, these acquisitions are dependent upon the exporter’s willingness to sell.

In these circumstances it is difficult for India to achieve one of its age-old core objectives, which is ‘Strategic Autonomy’. The ability to be independent and protect oneself from external threats without leading to heavy dependence upon other states with regards to national security. This was something that emerged during the cold war and India’s involvement with the Non-Aligned Movement and has been one of the few policies which have been institutionalized by the state – one of the reasons why India has so many different arms suppliers based in different countries.

This meant that at one point it is important for India to be able to source its military hardware from its own territorial boundaries like other rich countries. Local state-owned facilities such as the DRDO, HAL, ADA, CVRDE among others were made to boost India’s local defence design and manufacturing capabilities. And yet today it’s common knowledge that most of the hardware even today is imported and only the most basic and rudimentary equipment and technologies are made in India, and this is despite the government’s ‘Make in India’ / ‘Atmanirbhar‘ push.

Indian Military Personnel Testing Equipments
The Military Industrial Complex

India has truly little in the way of private defence industries. Whether it be big conglomerates and companies or smaller startups, they are very few in number and until recently seldom secured any contracts. One of the reasons being that the government wants to focus its hardware development and R&D on public sector firms, which have been proven to not only be inefficient but also incompetent. Marred by bureaucratic troubles these institutions have failed to deliver their set targets.

Most startups that do manage to come up fail to secure significant contracts from firms or the government and are as such forced to shut down. This is again attributed to the government’s inability to understand that despite its jingoistic attitude the public sector with all its demerits is incapable of spurring technological growth. Most of the innovations in technology including that of defence occur at the hand of the smaller MSMEs, startups, and other private players by way of competition in the free market.

In India, the startup culture is not as vibrant as say in Europe or the US, to begin with, and on top of this, the government fails to provide a conducive atmosphere through concessions and tax benefits. Many government schemes fail to benefit the entrepreneurs as most do not make much in the way of profits in the first three to five years of their existence. This makes it difficult for startups to settle in the market.

And yet there are some companies that are able to do well in this industry, not necessarily due to the government’s efforts. One of them being MKU also known as M Kumar Udyog based in Kanpur, which creates ballistic helmets for more than 100 countries and their special forces. They have also been involved in amour development in European countries as well as designing armour panels for German ships in Turkey.

Other companies which are involved in defence products such as Kalyani Group which has designed high-calibre artillery guns and ultra-light armoured vehicles for the Army. Mahindra and Mahindra have also been able to make APCs and other armoured vehicles for the armed forces and so has TATA with its 8-Wheeled APC, although most of these have not yet been ordered by the armed forces.

India's Emerging Military Industrial Complex
Why These Startups Won’t Grow in Number

It is clear that in today’s globalized world, in the industrial age, it is more important to understand how the global supply chain functions and how innovations in defence equipment are conducted. Unlike in the Pre-Information age, where most of the parts and the systems used in these defence platforms are neither sourced house nor they are made in a single country but rather it is much more prudent to have a multinational approach in these matters, wherein the nations would be able to pool their knowledge and technology as well as their resources to drive costs down.

This method which has been adopted by most developed and rich countries such as those belonging to NATO has proven to be a success in many regards in terms of technology innovations. Where companies used to make the parts and systems for their platforms in-house three decades ago, that is no more the case today.

As such the concepts of ‘Make in India’ and ‘Atmanirbharta’ are no longer in place today. Even ‘Strategic Autonomy’ is something which can be questioned for its relevance today from India’s point of view. When it is important to co-operate with foreign companies and invest in private players and MSMEs, the Indian government continues to spend money on projects which are being developed by State-owned entities, even after its clear that it is unlikely to yield results.

Therefore, it seems unlikely that the government’s and the military’s policies towards defence procurement would change in the near future. The private players and newer startups would continue to be ignored by the government in favour of incompetent public sector companies, and the military would be forced to source equipment from outside the country which undoubtedly leads to corruption, mismanagement, and kickbacks to the officials, failing to create a domestic ecosystem and perpetuating the normalization of obsolescence in the military.

Default image
Shashank Sekuri
Articles: 17

Leave a Reply