FSFI, Fonds Stratégique France Inde
France–India Industrial Affairs Observatory

Policy, markets and the decisions shaping the industrial corridor.

France and India are deepening their industrial relationship. Trade policy, aerospace programmes, defence procurement, investment rules and state-level incentives can each change where and how companies build capacity.

France ⇄ India
FSFI follows these developments through an industrial lens. Each development is considered for what changed, why it matters and what companies should examine next.
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Policy and trade

EU–India trade negotiations, bilateral agreements, tariffs, standards and market access.

Aerospace, defence and MRO

Industrial programmes, procurement, localisation, certification and supply-chain opportunities.

Investment and industrial capacity

Manufacturing incentives, state policies, industrial sites, skills and infrastructure.

Capital and execution

Financing conditions, partnerships, joint ventures, acquisitions and the practical demands of scaling across both countries.

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Investment and industrial capacity

India's industrial policy framework is reshaping where aerospace and defence capacity can be built. Production Linked Incentive schemes across fourteen sectors reward local manufacturing output, while states compete to host aerospace and defence parks with dedicated land, testing infrastructure and supplier ecosystems.

National incentives

PLI schemes, the defence indigenisation lists and offset requirements each create distinct routes to local production. Eligibility, timelines and compliance obligations differ by programme and must be examined case by case.

State ecosystems

Karnataka, Tamil Nadu, Telangana and Uttar Pradesh have built dedicated aerospace and defence corridors. Site selection involves land, logistics, skills availability and state-level incentives, not only headline policy.

Supply-chain depth

Indian suppliers are winning a growing share of aerostructure and component work packages. Building durable capacity depends on qualifying local suppliers and developing skills over several years.

What companies should examine

Incentive eligibility, certification pathways, local partnership structures and the practical demands of scaling across both countries. FSFI examines these questions with operators through an advisory lens.

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France ⇄ India

Industrial agreements and implementation

Follow the principal bilateral frameworks from signature through implementation. Status reflects the latest cited public record and does not by itself confirm legal entry into force, funding, procurement or project completion.

Framework adoptedImplementation underwayExploratory cooperation

Tracker reviewed 26 September 2026. Official source links open the underlying public record.

Horizon 2047 Roadmap

Implementation underway

Long-term bilateral framework spanning defence, space, critical technology, energy, education and resilient value chains.

Key dates

  1. Roadmap adopted in Paris
  2. Leaders reviewed implementation in India
  3. Annual review mechanism established

Latest public position

The February 2026 joint statement elevated the relationship to a Special Global Strategic Partnership and established an annual Foreign Ministers Comprehensive Dialogue to review implementation.

Next milestone to watch

Annual bilateral review of Horizon 2047 priorities and delivery.

Official source: France–India Joint Statement, 17 February 2026

Defence Industrial Roadmap

Implementation underway

Co-design, co-development and co-production, including aviation, maritime systems, space, cyber, robotics and resilient defence supply chains.

Key dates

  1. Roadmap adopted
  2. Progress reviewed by both leaders
  3. Co-development focus reaffirmed

Latest public position

Adopted during President Macron's January 2024 state visit. Subsequent bilateral statements have continued to record industrial partnerships and localisation activity under its objectives.

Next milestone to watch

Public confirmation of programme-level delivery, production milestones and additional industrial work packages.

Official source: India–France Joint Statement, January 2024

France–India Roadmap on Artificial Intelligence

Implementation underway

Cooperation on safe and trustworthy AI, research, standards, computing capacity, open models, skills and industrial partnerships.

Key dates

  1. AI declaration and roadmap launched
  2. Year of Innovation inaugurated

Latest public position

The roadmap was launched in February 2025. The India–France Year of Innovation opened in Mumbai in February 2026 alongside the AI Impact Summit.

Next milestone to watch

Publication of further Year of Innovation outcomes and programme-level research or industrial collaborations.

Official source: India–France Joint Statement, February 2026

SMR and AMR Partnership

Exploratory cooperation

Proposed cooperation on small modular reactors and advanced modular reactors, alongside training and civil nuclear research.

Key dates

  1. Declaration of intent signed

Latest public position

A declaration of intent was signed in February 2025. This records an intention to establish a partnership, not an operational reactor programme or completed project.

Next milestone to watch

Any bilateral implementation agreement, technical work programme or project-specific regulatory process announced by the parties.

Official source: Government of India list of outcomes, February 2025
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Latest analysis

Investment and industrial capacity

FSFI's view of the industrial choices behind current developments. These notes distinguish reported developments from our advisory interpretation and the questions operators should test next.

FSFI analysis · 26 Sep 2026

Incentives are not a location strategy

India's national and state incentives can improve an industrial case, but they do not replace a rigorous choice of ecosystem, operating model and programme horizon.

The development

Production Linked Incentive programmes and state-level industrial policies have increased the range of support available to manufacturers. Aerospace and defence projects, however, often combine long qualification cycles, specialised infrastructure and programme-specific localisation requirements.

FSFI view

FSFI's view is that incentives should be tested after the operating model is credible, not used to choose the operating model. A durable location decision starts with customer proximity, supplier capability, certification pathways, skills and logistics. The incentive package should then be assessed against the investment timetable, eligible expenditure, performance conditions and the practical cost of compliance.

Questions for operators

  • • Which benefits remain available under the project's actual legal entity, activity and commissioning schedule?
  • • Can the local skills and supplier base support qualification and ramp-up without weakening delivery in France?
  • • What obligations continue after an incentive is awarded, and who owns the evidence required for compliance?
Underlying source: Invest India: Production Linked Incentive schemes
FSFI analysis · 19 Sep 2026

Industrial corridors need programme-level diligence

Aerospace clusters offer different combinations of customers, talent and infrastructure. The right comparison is programme-specific, not a ranking of states.

The development

Karnataka, Tamil Nadu, Telangana and Uttar Pradesh have each developed aerospace and defence ecosystems. Their propositions differ across engineering talent, production depth, land, testing facilities, logistics, anchor customers and state support.

FSFI view

FSFI's view is that site selection should be tied to the work package and its certification path. Engineering-led activities, serial production, maintenance and defence programmes do not create the same location requirements. A useful assessment also considers how a French team will govern quality, transfer know-how and maintain customer assurance during ramp-up. Headline incentives matter less if the site adds operational friction or separates the project from the suppliers it must qualify.

Questions for operators

  • • Which ecosystem already contains the customers, certifying capabilities and suppliers relevant to the work package?
  • • How will management, quality and technical authority operate between France and India?
  • • What is the realistic sequence from site decision to qualified output?
Underlying source: Invest India: Aerospace and defence sector
FSFI analysis · 12 Sep 2026

Localisation is a capability-building sequence

Moving a work package is not a single transfer event. It is a governed sequence of supplier qualification, skills development and progressive industrial assurance.

The development

Indian suppliers are taking on a broader range of aerospace manufacturing work, while major programmes are expanding local assembly and maintenance capacity. This creates openings for French small and medium enterprises, but also raises the standard expected of localisation plans.

FSFI view

FSFI's view is that localisation should begin with a precise capability map and a staged transfer plan. The strongest approach identifies which processes can move first, what must remain under French technical authority, and where local partners need time to reach the required quality and delivery performance. Governance, intellectual property, export controls and continuity of supply need to be designed into the sequence rather than addressed after production starts.

Questions for operators

  • • Which capabilities are genuinely transferable now, and which depend on further supplier development?
  • • How will first-article inspection, configuration control and recurring quality be governed?
  • • What milestones allow capacity to scale without creating a single-point dependency?
Underlying source: Airbus: C295 final assembly line in India

FSFI analysis is general industrial commentary for information only. It is not investment advice, an offer, a recommendation or an invitation to subscribe to any product or vehicle.

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Recent and past developments

Headlines are collected automatically from public online news sources and refreshed regularly, alongside selected reference developments from recent years. Each item links to its original source with its publication date. They are third-party reporting, not FSFI analysis, and an announced measure is not necessarily in force. Last refreshed 31 Oct 2026.

Sector
Date range
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From announcement to industrial action

A policy announcement is a starting point, not an investment decision. FSFI examines its implementation, timing and commercial consequences so that companies can assess opportunities with appropriate diligence. This page provides industrial information only and makes no claims about investment products or returns.

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