India-Backed HAMMER Pact Fuels Defense Self-Reliance Push with France

India has taken a significant step toward self-reliance in defense technology with a new partnership to locally produce an air-to-ground weapon system. The Indian defense firm Bharat Electronics and French manufacturer Safran Electronics & Defense signed a pact to co-develop the HAMMER system, designed for integration with platforms like the Rafale and Tejas fighter jets. The agreement, announced by India's Ministry of Defence, aims to boost domestic capabilities in precision-guided weaponry.

The collaboration is part of New Delhi's broader strategy to reduce dependence on foreign suppliers and strengthen its domestic defense industrial base. HAMMER, a precision-guided munition, will be manufactured, maintained, and supplied entirely in India. This move follows other recent initiatives, including discussions to jointly produce fighter jet engines with Safran.

The timing of the announcement comes amid heightened strategic activity in India's defense sector. Just days prior, an Indian Tejas fighter jet crashed during a flight demonstration at the Dubai Airshow, highlighting the challenges in India's push for indigenous aerospace development. The incident has intensified scrutiny on the reliability of homegrown defense systems.

Strategic Implications for India and France

The partnership between Bharat Electronics and Safran reflects a deepening defense relationship between India and France. Over the past year, New Delhi has increasingly looked to Paris as a key partner in military modernization. In August 2025, Indian Defense Minister Rajnath Singh announced plans to co-produce fighter jet engines with Safran, signaling the scale of future collaboration.

The HAMMER system is expected to serve as a critical component of India's airpower, compatible with both the Rafale and Tejas aircraft. As India faces strategic challenges on its borders with China and Pakistan, the acquisition of advanced precision-guided weapons is becoming a top priority. The Indian Air Force has already placed a large order for 26 French Rafale Marine fighter jets in a deal valued at $7.2 billion, underscoring the growing importance of French platforms in India's defense ecosystem.

Broader Geopolitical Context

India's defense partnerships have expanded beyond traditional suppliers like the U.S. and Russia, as part of a larger push for strategic diversification. The recent G20 summit in Johannesburg saw high-level discussions on defense and technology cooperation, including between Canada and France. Canadian Prime Minister Mark Carney and French President Emmanuel Macron discussed joint efforts in defense and aerospace, signaling broader regional alignment.

Meanwhile, European leaders expressed concerns over the U.S.-proposed 28-point peace plan for Ukraine, calling it a starting point that requires further refinement. Macron emphasized the need for broader European consultation, noting that many aspects of the plan-such as frozen Ukrainian assets and NATO commitments-involve European interests. The discussions highlight the complex diplomatic landscape in which India's defense deals are being negotiated.

Market and Financial Implications

The HAMMER collaboration also has potential market implications for both Bharat Electronics and Safran. Bharat Electronics, a key player in India's defense sector, is expected to benefit from the growing demand for locally produced weapons. Safran, for its part, gains a strategic foothold in the Indian defense market and aligns with New Delhi's Make in India initiative.

In related markets, KULR Technology Group has seen its stock rise following the development of a 400V battery system for defense applications. The company's rapid delivery of a prototype for a Counter-UAS Directed Energy System has drawn investor attention, with the defense energy market projected to grow significantly in the coming decade.

Challenges and Future Outlook

Despite the progress in defense collaboration, India's domestic aerospace sector faces challenges. The recent crash of a Tejas fighter jet has raised questions about the maturity of homegrown platforms. The Indian Air Force has launched an investigation, but the incident underscores the need for continued investment in testing and quality assurance.

The HAMMER program, meanwhile, is expected to enter production in 2026, providing a near-term boost to India's defense manufacturing sector. As the program progresses, it will be closely watched by investors and analysts for signs of successful integration and operational deployment.