Dec 17, 2019   SOURCE: BusinessWire

India Defense Market Report 2019: Attractiveness, Competitive Landscape and Forecasts to 2024 - ResearchAndMarkets.com

The "The Indian Defense Market - Attractiveness, Competitive Landscape and Forecasts to 2024" report has been added to ResearchAndMarkets.com's offering.

The Indian Defense Market - Attractiveness, Competitive Landscape and Forecasts to 2024 provides readers with detailed analysis of both historic and forecast defense industry values, factors influencing demand, the challenges faced by industry participants, analysis of industry leading companies, and key news.

As one of the leading importers of defense equipment, India's defense expenditure is anticipated to register a CAGR of 9.11% over the forecast period 2020-2024. The growth in the Indian defense expenditure is mainly fueled by the need to secure its strategic interests while facing the rise of China. India shares a 3,323 km long land border with Pakistan, and an even longer 3,488 km border with People's Republic of China (PRC), and has territorial disputes with both countries over the ownership of the Northern State of Kashmir and the North Eastern State of Arunachal Pradesh.

The robust growth in Indian defense expenditure can thus be attributed to the precarious geo-strategic scenario and myriad of strategic challenges that continue to erode India's strategic advantage over its adversaries. These factors have played a crucial role in spurring growth in the Indian base defense expenditure (excluding pensions) over the historic period, which increased from US$33.8 billion in 2015 to US$45.4 billion in 2019, reflecting a CAGR of 7.70% over the historic period. Over the forecast period the country's defense expenditure is forecasted to increase from US$68.4 billion in 2020 to US$104 billion in 2024, exhibiting a CAGR of 11.05% over the analysis period.

Between 2014-2018, India was ranked as the second largest importer of defense equipment, behind only Saudi Arabia. The acquisition of defense equipment is mainly driven by the need to gain a significant technological advantage over Pakistan, while retaining a level of strategic parity with respect to China. Against this backdrop, India's defense capital expenditure is valued at US$14.7 billion in 2019 and is anticipated to rise from US$16.4 billion in 2020 to US$25.9 billion in 2024, exhibiting a CAGR of 12.02% over the forecast period.

Indian homeland security expenditure expected to reach US$19.2 billion by 2024. India faces a high level of threat from terrorist attacks and in the country has been compelled to heavily invest in counter-terrorist measures. Over the period 2015-2019, the country invested a total of US$60.9 billion in homeland security, which is expected to increase to US$84.5 billion over the forecast period. Due to the nature of the security threats facing India, the main opportunities for growth in homeland security are expected to be in border security, police force modernization, aviation, mass transportation, and maritime security markets.

Scope

  • The growth in the Indian defense expenditure is mainly fueled by the need to secure its strategic interests while facing the rise of China. India shares a 3,323 km long land border with Pakistan, and an even longer 3,488 km border with People's Republic of China (PRC), and has territorial disputes with both countries over the ownership of the Northern State of Kashmir and the North Eastern State of Arunachal Pradesh. Pakistan has rejected the line of control (LoC) becoming an actual demarcated border between India and Pakistan, and China refuses to accept the McMahon Line as the demarcated border between the two countries and continues to stake claim over Arunachal Pradesh, which it deems to be an extension of the Tibetan Plateau.
  • Indian strategic concerns mainly revolve around the containment of the expanding Chinese influence in South Asia and the Indian Ocean Region (IOR), while preventing both China and Pakistan from forcefully changing the status-quo along the Indian frontiers. The robust growth in Indian defense expenditure can thus be attributed to the precarious geo-strategic scenario and myriad of strategic challenges that continue to erode India's strategic advantage over its adversaries.
  • These factors have played a crucial role in spurring growth in the Indian base defense expenditure (excluding pensions) over the historic period, which increased from US$33.8 billion in 2015 to US$45.4 billion in 2019, reflecting a CAGR of 7.70% over the historic period.
  • Historic data shows that the average capital expenditure allocation of the total Indian defense budget was 32.2%, and the allocation is expected to decline marginally during the forecast period to an average of 32.1%.
  • The Indian MoD is expected to invest in conventional submarines, multi-role aircrafts, corvettes, tanks, artillery guns, Multi Barrel Rocket Launchers (MBRL), helicopters, nuclear submarines, surface-to-air missiles, Unmanned Aerial Vehicles (UAV) and frigates among others.

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