Overview

Bottom line: The United States and India have signed a 10‑year defence framework, signalling a tighter strategic embrace to deter the PRC across the Indo‑Pacific. The pact formalises expanded coordination, information‑sharing and technology cooperation — dovetailing with Washington’s Pacific Deterrence Initiative (PDI) funding and India’s rising defence outlays.

Key Highlights

  • PDI 2025: $9.9 billion requested to reinforce Indo‑Pacific posture and allied capacity.[1]
  • India’s Defence Budget: +9.5% YoY to ₹6.81 lakh crore (~$77–79 billion).[2]
  • Industrial Cooperation: Builds on the 2023 Roadmap for Defence Industrial Cooperation to co‑produce engines, UAVs, and maritime systems.[3]

Strategic Impact

The framework enhances U.S. logistics depth, accelerates joint munitions and sensor co‑production, and strengthens networked deterrence through interoperable C2 and data‑links. The initiative reinforces the U.S. advantage in cyber, space and undersea domains.

Supply‑Chain Implications

Joint production of aerospace, maritime, and electronic systems in India reduces dependence on China‑linked supply chains, diversifying global defence manufacturing.

Economic Outlook

U.S.–India trade reached $212 billion in 2024, with growing defence‑tech services expected to offset the $45.8 billion U.S. goods deficit.[4]

Sources

  • [1]U.S. DoD, FY2025 Pacific Deterrence Initiative Budget.
  • [2]Reuters, India’s Defence Budget 2025–26.
  • [3]DoD, U.S.–India Defence Industrial Cooperation Roadmap (2023).
  • [4]BEA / USAFacts Data (2024).