Good news for India’s defence sector! On September 5, Chief of Army Staff General Upendra Dwivedi highlighted how recent GST reforms will give a big push to India’s military capabilities. These changes are expected to lead to more investments and better results for the Indian Army and related industries.
The government has made a significant move to boost defence manufacturing by completely removing GST on many weapons, military aircraft, and equipment. This means these items are now cost-free in terms of tax, making them more affordable and easier to procure.
One of the biggest changes is the drastic reduction in GST for drones—from 28% down to just 5%. This will encourage more use and innovation in drone technology for defence purposes.
During an event in New Delhi, General Dwivedi expressed his gratitude to the government for these reforms. He said, “This will help our defence corridors grow rapidly, allowing us to make bigger investments and get better results. Micro, small, and medium enterprises (MSMEs) and startups will also benefit. They will find it easier to invest in research, development, and manufacturing for the Indian Army.”
Thanks to the new GST rules in the GST 2.0 regime, several military items that used to have 18% GST now have zero rate. This includes important aircraft like the C-130, purchased from the US, and the C-295 transport aircraft, jointly built by Airbus and Tata in Vadodara.
GST has also been removed on missiles launched from drones used by the armed forces, as well as on other critical equipment like satellite communication systems (GSAT), ship-launched missiles, flight simulators, underwater vessels, and fighter jet ejection seats—these are vital for pilot safety in emergencies.
Overall, these GST cuts are expected to slow down costs, promote domestic defence manufacturing, and make India’s military gear more capable and available for national security.
Stay tuned for more updates on India’s defence advancements!
