In a significant boost to India’s defence manufacturing ambitions, Reliance Defence has signed a ₹10,000 crore strategic cooperation agreement with Germany’s Diehl Defence to locally produce the Vulcano 155mm precision-guided ammunition system. The advanced artillery munitions will be manufactured at a new facility in Ratnagiri, Maharashtra, aligning with the government’s Make in India and Atmanirbhar Bharat initiatives.
The Vulcano system is a next-generation long-range munition, using GPS and laser-guided targeting for enhanced strike accuracy. This capability is critical in modern battlefields where precision reduces collateral damage and improves mission effectiveness. The new manufacturing unit will be part of the Dhirubhai Ambani Defence City and will involve over 50% indigenous value addition.
Reliance Defence will serve as the prime integrator for the programme, while Diehl Defence will transfer the core technologies and provide technical expertise. With projected revenues touching ₹10,000 crore, the project is expected to bolster India’s defence exports and reduce dependence on foreign ammunition systems.
This collaboration is Reliance Group’s fourth major defence tie-up, following partnerships with Dassault Aviation, Thales Group, and Rheinmetall. Diehl Defence, a German company with over €2 billion in annual sales, is known globally for its advanced missile and ammunition solutions.
However, the deal comes amid reports that Diehl Defence is also promoting its IRIS-T air defence system to Pakistan. The IRIS-T system, currently deployed in Ukraine, is capable of intercepting supersonic threats like Russia’s Oniks missile and is considered technologically comparable to India’s BrahMos.
Strategic analysts in India have expressed concern over Germany’s dual-track defence diplomacy in South Asia, questioning the long-term implications of its simultaneous engagements with rivals in the region. Despite this, the stock market reacted positively to the deal, with shares of Reliance Infrastructure rising 3.5% to close at ₹404.40 on the BSE.
The agreement signifies a critical step forward in India’s journey toward defence self-reliance while also stirring a renewed debate over global arms trade ethics and regional strategic balance.
