India has one of the largest budgets for Defence. The allocated Defence budget for 2015-16 is INR 2,467.27 Billion, which is 7.7% more than 2014-15’s allocation of INR 2,290 Billion. This Whitepaper tries to highlight the opportunities in manufacturing of defence electronics. It is one segment where in there is huge unexplored potential for private manufacturers, especially the domestic players. After the door was opened to private players in 2001, there has been quite a decent growth of private participation. The recent relaxation of FDI in Defence sector to allow 100% FDI in Defence Manufacturing is expected to bring in more FDI into the country and create opportunities for local MSMEs to forge an alliance with major foreign players. This relaxation of the policy is in alignment with the ‘Make in India’ program which is expected to boost the overall manufacturing sector in India.