Uttar Pradesh Targets USD 25 Billion in Aerospace and Defence Production by 2025-26

Uttar Pradesh aims to achieve USD 25 billion in aerospace and defence production and USD 5 billion in exports by the 2025-26 fiscal year, as part of its broader strategy to expand manufacturing in the sector. The state government is developing a supply chain network through a dedicated defence MSME corridor to support the Uttar Pradesh Defence Industrial Corridor (UPDIC). Investment commitments have reached over Rs 30,000 crore out of the targeted Rs 50,000 crore, with projects distributed across six nodes: Aligarh, Agra, Kanpur, Lucknow, Chitrakoot, and Jhansi.

Several companies have invested in the corridor, including Bharat Dynamics Limited in Jhansi, Adani Defence Systems and Technologies in Kanpur, and DRDO-BrahMos Aerospace in Lucknow. In February 2024, Adani Defence & Aerospace inaugurated ammunition and missile manufacturing facilities in Kanpur, marking the first phase of the state's defence corridor. These facilities are designed to produce various calibres of ammunition and missiles for the Indian armed forces and police, spanning 500 acres and aiming to produce 150 million rounds of small-calibre ammunition annually, covering 25% of India's requirement.

To support industrial expansion, the state has allocated approximately 5,000 hectares of land across the six nodes, with over 1,500 hectares already acquired by the Uttar Pradesh Expressways Industrial Development Authority (UPEIDA). Each node has a specialized focus: Aligarh on drones and small arms; Kanpur on military textiles and protective equipment; Jhansi on arms and ammunition; Lucknow on aerospace technology and BrahMos missiles; and Agra on electronics and non-polluting units.

The state government has introduced incentives for businesses, including capital and land subsidies, stamp duty waivers, and state GST reimbursements. The Aerospace and Defence Unit and Employment Promotion Policy 2024 aims to generate 100,000 jobs and offers foreign investors subsidies of up to 80 percent on land acquisition.

These initiatives are designed to strengthen the local defence manufacturing ecosystem and increase domestic production capacity.