Small Arms Market Overview (INDIA)
India's market size
By 2025, it is anticipated that India's market for small guns will reach $500 Mn USD. The
purchase of new weapons for the armed forces and other law enforcement organizations, as
well as the upgrading of the current inventory, would be the main driving forces behind this.
The small arms market has been expanding at a 4% compound annual growth rate (CAGR),
and this trend is anticipated to continue. This is due to the fact that the military's current stock
of small guns is either running out or approaching the end of its serviceable life. A sizeable
amount of the demand is made up of the military small arms market, which is predicted to
expand at a CAGR of 4.17%.
Future Assault Rifles, Carbines/Sub Machine Guns, Sniper Rifles, and Light Machine Guns
are required. The purpose of the Future Infantry Soldier as a System (F-INSAS) initiative is to
arm the Armed Forces with more advanced and effective equipment.
The market for these weapons is anticipated to grow at a CAGR of 4.17% due to the presence
of threats from across borders. States' police forces and central law enforcement agencies must
also upgrade their equipment
The importance of the soldier on the ground will endure even though future wars may
necessitate multi domain operations. Thus, it is crucial to provide the soldiers with cuttingedge gear. Without sacrificing the essential elements of security, it is necessary to meet the
need locally and liberalise the regulatory processes. To accomplish this goal, both the public
and private sectors of industry are working together with the government.
Policy Regulations
Recently, policy-related improvements have been expedited and designed to be more inclusive
in order to reduce regulatory burden, support defense production, and make doing business
easier.
The goal of the new policy measures, which are particularly relevant to the arms and
ammunition industry, is to foster domestic defense manufacture while also attracting
international capital.
The MoD issued a list of defence products that will need an industrial licence in January 2019
as part of the relaxations to the defence products list (IL). All other products, parts, and
components (not just those on the list), may be produced without the IL. This unwinding would
reduce the pressure on Indian businesses to produce goods.
Provisions for Industrial Licensing
The MoD has increased the ILs' validity from three years to fifteen years with the option to
extend it by a further three years on a case-by-case basis. Moreover, under the Arms
Regulations, licences for the production of weapons are now valid for the duration of the
company, subject to requirements like:

Within seven years of the licence being granted, the licensee must establish a facility
for the manufacture and/or proof testing of guns and ammunition as well as completing their
trial runs.
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The licensee has also been granted permission to increase production capacity up to
15% of the initial quantity authorised under the licence by merely notifying the licencing
authorities in advance6.
Limits on FDI
In the defence industry, the government has already approved FDI up to 74% under the
automatic procedure. Government clearance may be required for foreign investment above
74% in circumstances when it will give the nation access to cutting-edge technologies.
Public Sector in Small Arms (DRDO and OFB)
The Defense Research and Development Organization's (DRDO) main research facility for
conventional weapons research and development (R&D) is the Armament Research and
Development Establishment (ARDE). The 7.62mm Ishapore Self Loading Rifle, 5.56x45mm
rifles for the Indian Small Arms System (INSAS), light machine guns, and 40mm under barrel
grenade launchers (UBGL) for INSAS and AK-47s have all been produced by ARDE. In
addition, a multi-caliber weapon that can fire ammunition of different calibres by switching
out the barrel assembly is currently being developed.
A corner shot weapon system that would enable its user to see and attack an armed target
without coming under attack is also being developed in the lab.
Revolvers, pistols, sports rifles, pump action rifles, INSAS 5.56x45mm rifles, Ghatak
7.62x39mm rifles, and Excalibur 5.56x45mm rifles are among the small arms offered by the
Ordnance Factories. Moreover, OFs fired a 7.61x51mm assault rifle, an 8.64x74mm sniper
rifle, and a 5.56x30mm JVPC Alpha Carbine.
Small arms industry in Private sector
Indigenization initiatives are also being made by the corporate sector, both monetarily and
technologically. A few of these organisations engaged in the development of small guns are:
SSS Defence has devoloped assault rifle platforms (7.62 x 39mm calibre), sniper platforms for
cartridges with two different diameters (7.62 x 51mm and.338 diameters), and close-range
carbine platforms. A 75,000-per-year production capacity for small guns is anticipated when
the company's factory goes into service.
MKU In April 2018, MKU and a foreign business signed a Memorandum of Understanding
(MoU) for strategic cooperation to manufacture modern Caracal Assault Rifles (CAR) 817 AR
rifles in India.
It and Thales inked two memorandums of understanding in April 2018 to collaborate
strategically on the development and manufacture of F90 close-quarters battle (CQB) rifles and
optronic devices.
Jindal Defence Group By way of a joint venture (JV) with Taurus Armas, a Brazilian
business, Jindal Defence Group announced its entry into the Indian small weapons production
market. The agreement calls for the construction of a facility in Hisar (Haryana).
Adani Group Entered a joint venture (JV) between an Israeli and an Indian business, which
allowed it to enter the small arms market. The plant was built to produce weapons like Tavor
assault rifles, X-95 assault rifles, Galil sniper rifles, and Uzi submachine guns.
Recent Contracts
Israel Weapon Industries (IWI) and the Ministry of Defense (MoD) agreed to a contract of Rs
880 crore ($117.8 million) for 16,749 Negev NG-7 7.6251 mm light machine guns (LMGs) for
the Indian Army (IA).
In 2012, the Negev NG7 light was initially made available. The 7.62x51mm NATO cartridge
is chambered in the 17.41-pound general-purpose machine gun. It can shoot in two different
ways: semi-automatically or fully automatically, and it can be reloaded from an assault drum
magazine that holds 100 or 125 rounds. The Israel Defense Forces and several operators all
over the world employ the NG7 (NG stands for Next Generation).
In the first such basic infantry weapon acquisition in well over a decade, the MoD signed a
contract with US armaments manufacturer SIG Sauer on February 12th, 2019, to purchase
72,400 new assault rifles under the fast-track procurement (FTP) process. The indigenous
INSAS assault weapons are being replaced with supplies; 66,400 of them are intended for the
Army, 4,000 for the IAF, and the remaining 2,000 for the Navy. The US military and a number
of other European nations are both using weapons that can fire the 7.6251 mm round (bullet).
Existing demand
The total number of new 7.62mm calibre assault rifles needed by the armed services, notably
the 13 lakh-strong Army, is 8.16 lakh. The equivalent figure for CQB carbines is 4.58 lakh.
In March 2018, the defence ministry published RFPs (requests for proposals) for a finite
number of assault rifles and carbines that would be used to equip troops stationed near China's
and Pakistan's borders.
AK-203 Rifles
The most recent version of the renowned AK-47 weapon, the AK-203 assault rifle, will be
produced at the Ordnance Factory Korwa in Amethi. There will be 750,000 of these assault
rifles produced in India. The rifles would swap out the Army, Air Force, and Navy's current
INSAS assault rifles, which are built in India.
The government would then distribute the guns to the state police and paramilitary
organizations after first providing them to the armed forces.
Caracal 816 Carbines
The close-quarters combat carbines are now being awaited by the Indian Army (CQB). After
protracted trials costing $ 553.33 million, the UAE-based Caracal Corporation was rated L1.
The 9 mm Sterling carbines, which are being phased out progressively, will be replaced by the
new carbine.
Like the LMGs, the CQB carbines for the infantry division of the Indian Army are procured
through the Fast Track Procurement (FTP). For 93,895 CQB carbines, the Indian Army is
looking to purchase.
The lightweight semi-automatic rifle AR-15 serves as the foundation for the caracal carbine.
The 5.56 x 45mm NATO ammunition is used by the 3.4 kilogramme rifle, which has a 750–
950 rpm fire rate. The 5.56 round performs equally well as the 7.62mm round used in the AKseries of assault rifles and has a substantially higher bullet velocity. It will lighten the Indian
soldier's load out because it is considerably lighter than either the 7.62 or the currently in use
Sterling 9mm rifles.
Sniper Rifles
For its Special Forces and Infantry battalions stationed on the Line of Control, the Army had
planned to spend Rs 1,000 crore ($140 million) on 5,720 sniper rifles and 10.2 million rounds
of ammunition (LoC).
The outdated Dragunov weapons used by the Indian Army will be replaced with the new rifle.
The outdated Dragunov has been in use by army snipers since it was initially introduced to the
Indian Army in 1990. The ammunition for the weapon has increased in price, and there are
issues with its capability and dependability.