Defence Manufacturing Clusters: Centre Plans Seven Hubs Backed by IITs

The Centre is preparing to set up seven defence manufacturing clusters, each a grouping of states and union territories backed by dedicated IITs and centres of excellence, in what officials describe as a first attempt to build a federal architecture for arms production. The plan runs separate from the two defence industrial corridors already operating in Uttar Pradesh and Tamil Nadu.

The aim is stated plainly. Cut the import bill, and pull more economic activity out of every rupee the country spends on defence.

A senior official told businessline that the Ministry of Defence whole of nation proposal has reached an advanced stage of consideration. Defence Production Secretary Sanjeev Kumar has chaired two rounds of stakeholder consultations on the design, on 2 June and 10 June, by which point all seven clusters had been formalised and handed themes to build roadmaps and vision documents around.

How the cluster framework is built

Every cluster carries a lead state, a co-lead state, a set of participating states or union territories, and named IITs and research bodies tasked with innovation support. The structure is meant to push defence work past the established industrial belts and tie academic capacity to each theme. It builds on a domestic base that keeps widening, the same base that lately turned out the first Made in India C-295 transport aircraft from Vadodara.

Domestic defence production touched a record Rs 1.78 lakh crore in the last financial year, and the private sector now supplies close to a quarter of it. The seven defence manufacturing clusters are an attempt to organise that momentum by theme rather than leave it to scatter.

The clusters have been told to file their reports by next month.

Each report is meant to set out the cluster's contribution to its thematic agenda, along with its pain points, infrastructure gaps, regulatory hurdles and ease of doing business needs. The official said the Centre would then weigh policy interventions on the strength of what comes in.

There is an economic case running under the security one. The official framed defence spending as an output GDP multiplier, with every rupee put into manufacturing generating more than double the activity across the wider economy.

Defence manufacturing clusters and the states leading them

From governance to infrastructure

Seven themes, seven lead states. The split runs from governance and policy at one end to physical infrastructure at the other.

Karnataka heads the first cluster, which owns policy, institutional architecture and governance. Rajasthan is co-lead, with Kerala and Chhattisgarh as participating states. The academic bench is deep here, IISc Bengaluru alongside IIT Dharwad, IIT Jodhpur, IIT Palakkad and IIT Bhilai.

Maharashtra runs the second, the cluster that may matter most to private industry. Its theme covers indigenisation, enhanced private participation, MSMEs, startups and the innovation ecosystem, the part of the defence economy the Department of Defence Production has spent years trying to deepen through positive indigenisation lists and the iDEX route. Madhya Pradesh is co-lead. Goa and Puducherry come in as participating union territories, and IIT Bombay, IIT Indore and IIT Goa are the institutional partners.

Uttar Pradesh takes the third, built around testing, certification, quality assurance and standards. Jharkhand co-leads. Uttarakhand and Jammu and Kashmir participate, with IIT Kanpur, IIT BHU, IIT Roorkee and IIT Jammu behind the theme.

Assam leads the fourth, and this one is drawn on a map rather than a sector. It pulls in the northeastern and border states, with Tripura as co-lead and Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Ladakh participating. IIT Guwahati is the institutional partner.

Telangana has the fifth, on market access, demand visibility and defence export. Haryana is co-lead. Delhi, Chandigarh, Dadra and Nagar Haveli and Daman and Diu participate, with IIT Hyderabad and IIT Delhi as stakeholders.

Gujarat carries the sixth, on skill development and the link between industry, academia and research. Odisha co-leads, with Himachal Pradesh and Bihar among the participants. The academic side brings together IIT Gandhinagar, Rashtriya Raksha University, IIT Bhubaneswar and IIT Mandi.

Tamil Nadu closes the set with the seventh, on defence industrial infrastructure, clusters and common facilities. Andhra Pradesh is co-lead, and IIT Madras, IIT Tirupati and IIT Ropar provide the support.

Independent of the existing corridors

The seven clusters do not fold into the Uttar Pradesh and Tamil Nadu defence industrial corridors, which keep running on their own. Where the corridors, announced in 2018, are geographic concentrations of plants and vendors, the clusters are thematic, each a national network organised around a function rather than a footprint. Both states show up in the new scheme too, which threads the corridors into it.

What the clusters owe next

The near term test is the July reporting round. Once the cluster reports land, the Centre is expected to open deliberation on the policy changes each theme calls for, from the regulatory fixes the governance cluster flags to the export measures Telangana's group is meant to map.

How much of this reaches the private sector is the open question. Private firms still account for under a quarter of domestic defence output, a share the government has tried to lift through Make in India procurement routes such as the Rafale arrangement for 114 jets and through the rules that decide what actually counts as Indian made. The second cluster, under Maharashtra, is the one carrying that weight.