How To Start A Defence Startup In India

India has one of the most powerful armies in the whole world. India ranks 3rd in the list of most powerful armies in the world. India's budget for defence expenditure is Rs 4,78,196 crore, which is 13.73 % of the total central government expenditure of the year 2021-22. And it is a 1.4% hike over the previous year.

A Brief Guide On Starting A Defence Startup In India

How To Start A Defence Startup In India

Defence startup business is beneficial for the following people:

  • Defence Entrepreneur’s: Those entrepreneurs who want to start a defence startup or defence business.
  • Defence Startup Enthusiast: Those people who are very enthusiastic about defence business and have interest in starting a defence startup.
  • Defence professionals: Those people who work in defence or keep every knowledge and information about it. 
  • Defence Specialists: These are the people who work on defence weapons and love to contribute and improve defence equipment or weapons.
  • Defence Army People: People who worked in defence can also start a business in defence.
  • Defence Equipment: Those people who work as manufacturer or originator can also start a defence startup and this guide can help them too.
  • Defence Industry Technology Solutions: People who want to develop technology for the defence sector and start an industry or tech industry in defence in India.
  • Defence Engineers: Engineers who want to start their business or startup company can also read this guide to get started.
  • Defence Aerospace: Those who want to make or build business related to aerospace in defence.
  • Defence Contractors: Also defence contractors can read this and start their business in defence in india.
  • Defence Researchers: Of Course if you are a defence researcher then you can also go with this business.
  • Defence Institutions: If you run an institution you can also start this startup.
  • Defence Investors: You can also invest in defence businesses in India.

Market Growth and Market opportunities in Defense Industry of India:-

  • India has the third largest armed forces in the world.
  • The allocation of Defence in India's union budget is approx USD 34.53 billion and 31.1% of the defence budget is spent on capital acquisitions.
  • The Indian defence industry has a business scope of $USD 10 billion opportunity.
  • Government pushing Make in India, TOT and OEM, FDI so scope is biggest.

Which is the best Defence Sector to Start a business:

1. Aircrafts And Aero engines

An aircraft engine, often referred to as an aero engine, is the power component of an aircraft propulsion system.

Most aircraft engines are either piston engines or gas turbines, although a few have been rocket powered and in recent years many small UAVs have used electric motors.

2. Naval fleet

A fleet or naval fleet is a large formation of warships and the largest formation in any navy and also controlled by one leader. 

A fleet at sea is the direct equivalent of an army on land.

3. Heavy and manufacturing vehicles

Heavy vehicles industry in India has reflected a steady growth over the last decade by constantly trying to upgrade their technology and production processes.

Heavy vehicles in India are mostly made by companies like Tata motors and Ashok Leyland.

Heavy Vehicles or (HCVs) however form an indispensable part of the Indian automobile industry.

4. Arms and Rifles

A firearm is any type of gun designed to be readily carried and used by an individual. The term is legally defined further in different countries.

The first firearms originated in 10th-century China, when bamboo tubes containing gunpowder and pellet projectiles were mounted on spears to make the portable fire lance, operable by a single person.

5. Other equipments

The 41 Indian Ordnance Factories under control of Ordnance Factories Board manufacture most of the Army equipment such as small arms, ammunition, combat vehicles, artillery, and tanks.

Ongoing business deals in Defence Sector of India:

  • Bharat Forge in partnership with profile for setting up manufacturing facility in Gujarat.
  • Reliance, Dassault Aviation set up a JV as part of fighter jet deal.
  • Mahindra to forge a joint venture with Airbus to manufacture helicopters.
  • Hinduja group has partnered with Larsen & Turbo for manufacturing in various facets of Defence.
  • Tata Power SED tied up with Airbus to build 56 aircrafts.

What legal requirements a Defence startup is need to start business in India:

  • Start with a Private Limited Company.
  • Do start with GST from the beginning.
  • Take Trademark as you can enter into tie up with foreign brands anytime
  • Take an ISO certificate.
  • Factory or manufacturing licences if dealing in manufacturing.
  • MSME licence.
  • Startup India scheme licence.
  • Legal Contract drafting and vetting by a thorough professional.

How to Start a Defence Startup in India:

  • Have a Sound Business Plan
  • Solve a Defence problem and create a solution for Indian Army, Navy or Indian Air Force gold must be that only.
  • Create a network of Defence Armoury professionals.
  • Do visit the Global markets of Defence Israel and USA is biggest and Russia is third in manufacturing and visit their Defence summits and learn latest prototypes.
  • Create a B2B business plan as your audience won't be b2c.
  • Try to tie up with the Government of India in the Make in India defence programme.
  • You can also go for joint ventures with Foreign cos as Indian FDI limits are raised.
  • India's defence sector in a private sector way can become a hub for export promotion for defence deals through India.

Opportunity for Indian defence startups:

  • India's Defence and police forces are in dire need of new gear.
  • State-run tabs and firms are slow to keep up with technology shifts.
  • Changing terror landscape has pushed the forces to upgrade their weapons and surveillance system.
  • Indian ventures are getting better at integrating low cost, high quality hardware and software.
  • Plans to produce 40% of Defence needs from indigenous sources and make in India are  propelling ambitious plans.
    IdeaForge
    IdeaForge

Indian Agencies with whom a Defence Startup can Tie-up:

  • Ministry of Defence, Government of India
  • Department of Defence Production, Ministry of Defence
  • Department of Industrial Policy and Promotion, Ministry of Commerce & Industry, Government of India
  • Department of Commerce, Ministry of Commerce & Industry, Government of India
  • Defence and Strategic Industries Association of India

Where to find Defense Clients and how to market as a Defense Startup:-

  1. Defence Public Sector Undertakings
  2. Domestic Private Defence OEMs
  3. International Private Defence OEMs
  4. Defence Equipment Vendors
  5. Defence Equipment contractors/subcontractors
  6. Various government institutions linked with Ministry of Defence
  7. Financial Institutions
  8. Research Institutes
    TONBO imaging
    TONBO imaging

How to promote Defense Products as a Defense Startup:-

  • Defense Prototype's Demonstration Videos
  • Defense Product Explanation Videos
  • Product Sheets promotions targeting B2b audience base.
  • Infographics
  • Content marketing
  • Email marketing
  • Social media marketing
  • Search engine optimization
  • Paid ads
  • Webinars/Events
  • Interact with Your Online Community
  • Mobile Marketing
  • Referral Program
  • Influencer Marketing
  • On your website
  • As snippets on social media imagesIn marketing materials that you send out to your leads
  • In a blog post

Let's talk about a few startups that are in the defence sector and through which you can get an idea about how the Indian defence industry works.

Here is the list of case studies of few defence startups:

1. TONBO imaging

It is developed by a small company in Bangalore, take a look at it.

Tonbo builds imaging systems largely for surveillance, defence and military applications.

They manufacture and deploy sensing solutions that can see beyond the visible, process complex data for enhanced situational awareness and control dynamic environment for rapid decision making and increased autonomy.

2. IdeaForge

ideaForge is India’s largest manufacturer of drones for defence, homeland security and industrial applications.

Founded in 2007 by IIT-Bombay alumni, the organization has a consistent market share of over 90% in the Security & Surveillance segment.

The organization is a licensed manufacturer of UAVs approved by the Ministry of Defence (MoD).

3. AADYAH AEROSPACE

AADYAH was born with the belief in brilliance with firm grasp on our roots while aiming for the stars, never forgetting where we come from.

"Aadyah" in Sanskrit refers to the original" or "first power" from which all the five elements, or senses, originated.

True to its name, AADYAH strives to ascend to higher realms of brilliance in technology in all things related to aerospace.

DISCLAIMER
This video is merely a general guide meant for learning purposes only. All the instructions, references, content or documents are for educational purposes only and do not constitute a legal advice. We do not accept any liabilities whatsoever for any losses caused directly or indirectly by the use/reliance of any information contained in this video or for any conclusion of the information. Prior to acting upon this video, you're suggested to seek the advice of your financial, legal, tax or professional advisors as to the risks involved may be obtained and necessary due diligence, etc may be done at your end.