ReArm Europe Dynamics: The European Commission, in collaboration with the EU’s High Representative for Foreign Affairs and Security Policy, published a Joint White Paper on the Future of European Defence in March 2025. The paper outlines the ‘ReArm Europe’ initiative to mobilise up to €800 billion by 2030 to revitalise Europe’s defence industry. It signals a radical shift in Europe’s military posture, addressing concerns over geopolitical instability, uncertainty related to US commitment to NATO, and growing threats to the organisation. The plan’s core includes a Strategic European Armament Facility for Europe (SAFE) instrument that provides joint procurement loans of €150 billion, coordinated fiscal constraint relaxations and a concentrated effort for defence industrial readiness.
The White Paper identifies seven critical capability gaps currently existing – air and missile defence; artillery; ammunition; drones and counter-drone systems; infrastructure supporting military mobility; artificial intelligence and electronic warfare; and ‘strategic enablers’ like strategic airlift and tanker aircraft. The EU will aim to close these critical capability gaps by, for example, providing funding and incentives to help EU Member States achieve the necessary budgetary resources and spend them in the most efficient and targeted manner.
This project indicates the EU’s willingness to collaborate, presenting enormous opportunities for EU businesses, investors and stakeholders within the regulatory framework. India and several other Asian countries find themselves at a crossroads in this dynamic geopolitical landscape with opportunities for business partnerships, geostrategic positioning, and industrial collaboration. In this context of Europe’s strategic realignment, the evolving new framework of defence partnerships will provide India with an exceptional opportunity to expand its security collaboration and showcase its emerging defence industrial sector.
Industrial Alignment: Europe’s Shift Towards Self-Reliance and India’s Opportunity
A key pillar of the EU’s ‘ReArm Europe’ initiative is to provide financial levers to EU Member States to collaborate and significantly increase defence investment and capabilities. EU reduced leverages and dependencies on the US and to ‘buy European’ more, through defence deals with member states and members of the European Free Trade Association (EFTA). This has both challenges and opportunities for external partners, especially India. The EU and India have cemented their trade and technology partnerships with the Trade and Technology Council as a principle forum. A defence cooperation framework could also follow suit. India’s growing market can be a valuable asset for European defence industries.
India recorded a high of Rs 23,622 crore defence exports in FY 2024-25, a 12.04% increase over the preceding FY. With indigenous drone technology, missile systems, AI, cyber security and space technology, India could be a promising partner for European defence companies
India’s defence manufacturing sector has witnessed a growth trajectory under ‘Aatmanirbhar Bharat’ initiatives. India’s defence exports recorded a high of Rs 23,622 crore in the FY 2024-25, which is a 12.04% increase over the preceding FY. Having indigenous drone technology, missile systems, artificial intelligence (AI), cyber security and space technology, India projects itself as a promising partner for European defence companies to collaborate.
Key potential areas of collaboration include:
- Joint R&D: Indian and European firms can engage in joint R&D to develop advanced military technologies based on next-generation weapons, especially AI-powered autonomous systems; quantum computing in the sphere of defence; and offensive or defensive weapon types.
- Co-production and Manufacturing: With its high potential for cost-effective production, European companies can use India as a defence manufacturing base that would be affordable as well as scalable.
- Integration into European Supply Chains: Indian aerospace and defence sectors can be integrated into the supply chains of Europe, promoting technological collaboration and joint ventures.
India can emerge as a strategic partner within the EU’s defence ecosystem in line with the continent’s industrial rebalancing for mutual benefit. However, India’s strategic and defence ties with Russia could pose a challenge and would need to be managed in a balanced manner.
India and the European Union can strengthen their defence partnerships to promote a free and open Indo-Pacific amid China’s belligerence in the region. The partnership could also address common threats such as terrorism and cyber-attacks, enhancing strategic security framework
Geostrategic Positioning: Strengthening the Indo-Pacific Partnership
India and the EU can strengthen their defence partnerships to promote a free and open Indo-Pacific amid China’s belligerence in the region. The partnership could also address common threats such as terrorism and cyber-attacks, enhancing strategic security framework. Potential areas of enhanced defence collaboration include:
- Defence Diplomacy and Military Engagements: There is ample scope for bilateral and multilateral engagement and diplomacy in defence dialogue, joint military exercises, cyber warfare, space militarisation, counter-terrorism and hybrid warfare. This must be formalised and enhanced for mutual benefit.
- Maritime Security Cooperation: European naval forces and India figure prominently in the EU’s newly released Indo-Pacific strategy. This document presents a vision for the EU to increase its engagement with India and reflects its strategic partnership benefits. The Indian Navy must also seek collaborative partnerships on maritime security, counter-terrorism, and anti-piracy operations.
- Technology Infusion and Defence Collaboration: The visit in March 2025 by a delegation from the European Commission comprising 27 commissioners, along with their defence ministers, highlights the high priority placed by the EU on strengthening defence ties with India. It opens avenues for Indian defence companies to collaborate with EU nations and companies addressing the extensive requirements for defence equipment and platforms and become a vital market for Indian defence enterprises.
Contested Global Arena: India Must Prepare to Engage with EU
Europe’s €800 billion defence reset is not just a reaction to the latest threats, but rather an emblem of the bigger movement within a world security system that is increasingly characterised by systemic confrontation. The global response to this change is extremely diverse.
The European delegation’s India visit in March 2025 opens new avenues for Indian defence companies to collaborate with EU nations and companies addressing the extensive requirements for defence equipment and platforms and become a vital market for Indian defence enterprises
Russia considers this a direct escalation, taking Europe’s rearmament as another step in the consolidation of NATO’s military apparatus. China sees containment and views deeper EU-India security relations as a larger Western strategy to restrict its influence in Asia. Iran aligns deeper with the anti-Western axis, forging closer ties with Russia and China as the US and Israel target Iran. Israel would look at strategically balancing its defence relationships with the United States, the European Union, and new Asian powers.
As regards India with its balanced and respected foreign policy, it presents an opportunity to engage with European defence actors without being constrained by transatlantic dynamics, creating space for greater collaboration with the EU and diversifying its defence partnerships. For India, the challenge remains to capitalise on new opportunities while strengthening existing bilateral and multilateral partnerships in a contested and dynamic environment.
The world is witnessing a tectonic shift in geopolitical and strategic security alignments. India must position itself proactively at the forefront of this realignment in a balanced posture for the furtherance of its national interests.
The author, a PVSM, AVSM, VSM has had an illustrious career spanning nearly four decades. A distinguished Armoured Corps officer, he has served in various prestigious staff and command appointments including Commander Independent Armoured Brigade, ADG PP, GOC Armoured Division and GOC Strike 1. The officer retired as DG Mechanised Forces in December 2017 during which he was the architect to initiate process for reintroduction of Light Tank and Chairman on the study on C5ISR for Indian Army. Subsequently he was Consultant MoD/OFB from 2018 to 2020. He is also a reputed defence analyst, a motivational speaker and prolific writer on matters of military, defence technology and national security. The views expressed are personal and do not necessarily carry the views of Raksha Anirveda
