India’s defence ambitions are opening doors for a new generation of MSMEs to punch above their weight. The turning point for many was Operation Sindoor, which underscored India’s growing capabilities in indigenous defence technology.

At the panel discussion on Delivering a Big Bang (Defence Supplies) at the MSME Growth Conclave Coimbatore- 2025, it was noted that the Operation’s success sparked a wave of interest among MSMEs, especially in emerging areas such as unmanned aerial systems.

“Post Sindoor, many of our members have been actively asking how they can enter the drone space,” noted Sundaram Venkatapathy, Director, Codissia Defence Innovation and Atal Incubation centre (CDIIC), reflecting a broader momentum across industrial clusters such as Coimbatore.

Other speakers at the panel included Gyaneshwar Tyagi, Chief General Manager of the High Energy Projectile Factory, a unit of Munitions India Ltd; Sai Pattabiram, Managing Director and Founder, Zuppa Geo Nav Tech; and Ashok Atluri, CMD, Zen Technologies. The panel discussion was moderated by M Ramesh, Consulting Editor, businessline. 

“This growing interest is also backed by a maturing start-up and funding ecosystem,” said Atluri, adding that while MSMEs once relied heavily on hand-holding by the government, the landscape has changed.

“Today, if you have a bold idea and strong product vision, private capital is available,” he said. The goal, he stressed, must go beyond import substitution. “In war, there are no runners-up. We must aim to build the world’s best products,” he added.

However, despite the growing momentum, regulatory hurdles persist. Pattabhiram pointed to the requirement of a defence industrial licence to list products in the defence category on the Government e-Marketplace (GeM).

He explained: “To get that licence, you typically need to own land or have it on a long-term lease, often around 30 years, as part of security clearance norms. But most new-age, VC-funded start-ups follow asset-light models, and don’t invest in real estate As a result, many cutting-edge firms are locked out of GeM.”

Drone supplier

The panel also explored India’s opportunity to emerge as a global drone supplier amid rising demand for non-Chinese alternatives. “India can leverage this shift and its own domestic scale to build cost-competitive, export-ready systems,” said Pattabhiram.

He also highlighted how drones have evolved from mere surveillance tools to active weapons platforms, fundamentally reshaping battlefield dynamics and opening new export opportunities.

“War preparedness is more important than warfighting itself,” Tyagi summed up, underscoring the need for long-term thinking and strategic support to help Indian MSMEs rise to the occasion.

Published on June 27, 2025