The FICCI-KPMG event brought together prominent figures from the Indian Armed Forces, industry leaders, and international collaborators to explore the future of military ammunition manufacturing in India.
As India continues to focus on self-reliance and innovation, the future of its ammunition market looks promising, ready to meet both domestic and global defence needs. This optimistic outlook reflects a nation on the precipice of significant advancements, poised to make substantial contributions to the global defence landscape.
AMMO India 2024 Report states that the ammunition market is integral to the global defence industry, underscoring its importance for national security and military efficacy.
This report dives deep into the global ammunition landscape with a special focus on India, highlighting current trends, challenges, and opportunities for growth.
Globally, the demand for ammunition is estimated at INR 1,29,260 crores (US$ 15.5 Bn) in 2023 and is expected to grow to INR 1,84,092 crores (US$ 22 Bn) by 2032, at a CAGR of 3.95 percent over the next decade.
Geopolitical conflicts, increase in the military spending and rising insurgency are the primary reasons for this growth. Most nations are taking proactive measures to secure their borders as regional conflicts boil over. With increased demand, the global ammunition supply is set to increase and become efficient with the advent of robust technologies.
The Report states that the Indian ammunition market is at a pivotal juncture. It estimates the demand for the Indian ammunition market to be at INR 7,057 crores (US$ 844 Mn) in 2023, which is 5.5 percent of the global ammunition industry. However, it is poised to grow at a faster CAGR of 4.93 percent over the next decade i.e., a delta of ~1 percent over global growth, driven by, stockpile replenishment and the “Make in India” initiative.
In this regard, the Indian ammunition sector is a fertile ground to boost indigenisation. However, the ammunition market cannot be viewed in isolation as it is embedded within the ecosystem comprising regulatory environment, access to technology, etc., which shapes its growth and progress. In this report, the report analyses these factors and their interplay to delineate the challenges and the opportunities that exist.
Globally, the demand for ammunition is estimated at INR 1,29,260 crores (US$ 15.5 Bn) in 2023 and is expected to grow to INR 1,84,092 crores (US$ 22.0 Bn) in 2032, at a CAGR of 3.95 percent over the next decade
The global ammunition market is experiencing substantial growth, both in terms of volume and value. In 2023, the global demand for ammunition was pegged at INR 1,29,260 crores (US$ 15.5 Bn) with heavy calibre ammunition accounting for 53.48 percent of the global demand, followed by grenades, mines and mortars at 23.27 percent and medium calibres at 12.84 percent.
Today, India is proactively leading the narrative of finding smart and cost-efficient military solutions with the help of cutting-edge technologies and indigenously developed capabilities, and ammunition is no exception. Therefore, it is important for the Indian defence industry to advance its efforts to produce quality ammunition for the arms and weapon platforms used by Indian tri-services and CAPFs.
Vinod Sahay, Chair, FICCI Defence and Homeland Security Committee in his Foreword to the report said that AMMO India 2024 report prepared by FICCI and KPMG in India shares insights on the ammunition industry in India and globally and suggests the way forward to gain technological advancements through collaborative research and strategies. Thereby enabling the vision of “Make in India – Make for the World”, I hope all the stakeholders in government and industry will benefit immensely from this document.
India’s strategic position in South Asia, coupled with ongoing regional conflicts and border tensions has doubled down on the need for a robust and responsive defence stance. It has also driven the Indian government to significantly boost its defence spending
Indian Ammunition Industry
The Indian ammunition industry is on a fast track to grow, driven by a combination of strategic initiatives and pressing security needs. The primary drivers are the rising geopolitical tensions in the subcontinent, the need to replenish national stockpile reserves, a comprehensive modernisation programme and the resolve to become a self-reliant country.
India’s strategic position in South Asia, coupled with ongoing regional conflicts and border tensions has doubled down on the need for a robust and responsive defence stance. It has also driven the Indian government to significantly boost its defence spending, with a defence budget allocation of INR 6,21,540 crores (US$ 72.1 Bn) in 2024-25, up from INR 5,94,000 crores (US$ 72.1 Bn) in 2023-24. This 4.72 percent increase in allocation from the previous financial year aims to address the evolving security challenges and ensure that the armed forces are well-equipped to handle any threat.
Secondly, to ensure military readiness and for annual training requirements, India endeavours to maintain a robust stockpile of ammunition and to replenish it to the extent consumed or expired. This approach aims at addressing the shortfall in inventory, ensuring the forces have adequate supplies for sustained operations.
Thirdly, India’s ambitious defence modernisation programmes are a key driver of growth for the ammunition industry. The modernisation efforts are backed by the financial commitments, including a significant allocation of the defence budget to capital expenditures. In the current defence budget, 27.67 percent of the total was allocated for capital acquisition.
Self-reliance is a significant growth driver, propelling the industry towards greater independence and enhanced capabilities. The Indian government’s Aatmanirbhar Bharat initiative underscores this focus by prioritising domestic production and reducing dependency on imports
The government’s initiatives to promote defence production and exports play a pivotal role in this context, aiming to increase domestic production and reduce reliance on imports. Finally, self-reliance is a significant growth driver, propelling the industry towards greater independence and enhanced capabilities.
The Indian government’s Aatmanirbhar Bharat initiative underscores this focus by prioritising domestic production and reducing dependency on imports. In the positive indigenisation list released till date, there are approximately 85 items that have been identified by MoD to be indigenised by 2034.
The items listed include 120mm Fin Stabilised Armour Piercing Discarding Sabot (FSAPDS) Mark II ammunition, 30mm ammunition for Infantry Fighting Systems (IFS), 155mm artillery ammunition, and 14.5 mm Armour Piercing Incendiary (API) for Anti Material Rifle (AMR).
At the release function of the report, Cdr Gautam Nanda, Associate Partner, Aerospace and Defence, KPMG in India said, “India’s journey towards self-reliance in the ammunition sector is a collective effort that requires the dedication and ingenuity of all stakeholders. As we move forward, we remain committed to the vision of a self-reliant India, where our capabilities are built on the foundation of strength and innovation.”
General Anil Chauhan, Chief of Defence Staff and Secretary DMA, inaugurated the report release function, emphasising India’s need to reduce dependence on foreign nations for ammunition. Gen Chauhan said, “Our strategic focus depends on policy adaptations and the development of advanced ammunition. We are on the path to becoming the world’s third-largest economy, driven by intelligent and specific military advancements.”
General Anil Chauhan, Chief of Defence Staff and Secretary DMA, inaugurated the report release function, and emphasised India’s need to reduce dependence on foreign nations for ammunition
Lieutenant General N S Raja Subramani, Vice Chief of Army Staff, highlighted the importance of self-reliance in ammunition manufacturing, noting that global conflicts have underscored the need for India to produce its own defence equipment. “Strategic autonomy and economic growth are intricately tied to our ability to produce our own defence equipment.” he said.
Lt Gen Amardeep Singh Aujla, Master General Sustenance, Indian Army, outlined India’s progress in indigenising ammunition variants, with 154 out of 175 variants already being indigenous. He stressed the importance of research and development in driving innovation and efficiency in defence manufacturing.
Jyoti Vij, Director General of FICCI, pointed out the growing role of the private sector in defence manufacturing, fuelled by the “Make in India” initiative. She emphasised the need for increased collaboration between public and private sectors to achieve the goal of Aatmanirbhar Bharat in defence.
Raksha Anirveda's editorial desk team brings in the collective experience of creative professionals - a fine mix of senior copy editors, writers, proofreaders and designers. Working as a team, they continuously create, manage, and curate content to sustain the magazine's profile and reputation in line with market trends and achieve magazine's goal.
