India’s defence manufacturing ambitions may be set for a significant boost as Bharat Forge, one of the country’s leading industrial and defence manufacturers, enters advanced negotiations with major European defence companies to relocate parts of their production to India.
Baba Kalyani, Chairman of Bharat Forge, disclosed the development during an exclusive interview with CNBC-TV18, stating that the company is currently in active discussions with two to three prominent European defence firms. The talks, he said, are focused on establishing dedicated manufacturing lines in India that would primarily serve global export markets rather than being limited to domestic Indian requirements.
If finalised, the proposed arrangements could represent a structural shift in India’s role within the global defence industrial ecosystem, positioning the country as a key manufacturing base for European-origin defence systems and components.
According to Kalyani, the driving force behind these negotiations is the mounting pressure facing Europe’s defence manufacturing sector. Traditional defence producers across the continent are grappling with acute shortages of skilled labour and constrained industrial capacity. These challenges have intensified as European governments sharply increase defence spending in response to the evolving security environment, particularly following the Ukraine conflict, while global demand for weapons and military equipment continues to rise.
“European companies are facing real bottlenecks,” Kalyani indicated, noting that many firms simply lack the capacity to scale up production quickly enough to meet both domestic and international orders. As a result, they are increasingly exploring alternative manufacturing locations that can offer cost efficiency, scalability and a technically capable workforce.
India, with its expanding engineering talent pool and maturing industrial base, has emerged as a compelling option. Over the past decade, Bharat Forge has steadily built credibility as a defence manufacturer, moving beyond components to full-scale systems. The company has developed and produced advanced artillery guns, armoured vehicle platforms, and other mission-critical military hardware, both independently and in collaboration with international partners.
Importantly, recent export orders executed by Bharat Forge for artillery systems supplied to European countries have helped validate Indian manufacturing standards in some of the world’s most demanding defence markets. These exports have also demonstrated that Indian firms can meet stringent quality, reliability and compliance requirements imposed by NATO-aligned militaries.
Kalyani emphasised that the discussions with European companies represent a departure from the traditional model of defence cooperation, which has often revolved around licensed production for the Indian armed forces. Instead, the proposed partnerships are centred on export-oriented manufacturing, with Indian facilities integrated directly into the global supply chains of European defence majors.
“The idea is not just to make for India,” he said, underlining that production lines set up in India would supply customers worldwide. This model would allow European firms to overcome domestic capacity constraints while maintaining competitiveness and delivery timelines in a tightening global defence market.
The potential agreements align closely with the Indian government’s “Atmanirbhar Bharat” (Self-Reliant India) initiative, which aims to reduce reliance on arms imports and transform India into a significant exporter of defence equipment. Defence exports have already grown sharply over the past few years, and partnerships of this nature could further accelerate that trajectory.
For India, collaboration with established European defence players offers multiple benefits: deeper integration into global defence value chains, access to advanced technologies and processes, and the creation of high-skilled manufacturing jobs. For European companies, India offers a scalable and cost-effective manufacturing base capable of supporting long-term global demand.
If the ongoing talks translate into formal agreements, they would signal growing international confidence in India’s defence manufacturing capabilities. More broadly, such deals could mark a turning point in India’s emergence as a reliable hub for sophisticated defence production, reshaping both regional and global defence industrial dynamics.
