Make Categories

Imagine a shopping policy with a strict hierarchy of preference, always try to build it entirely at home first, and only fall back to buying it fully from abroad if there is truly no domestic option available at all. India's Defence Acquisition Procedure formalises exactly this hierarchy through what it calls Make Categories.

These categories classify every defence procurement based on how much indigenous design, development and content is required, ranging from Buy Indian IDDM at the very top, requiring fully domestic design and manufacture, down through categories requiring partial indigenous content, and finally to Buy Global, where equipment is procured directly from foreign sources when no viable Indian option exists. Each category carries different eligibility rules, timelines and cost implications, and the classification a specific procurement falls under substantially shapes which companies, Indian or foreign, can even bid for it.

Understanding Make Categories is essential to understanding Indian defence sector stocks, since a company's addressable opportunity depends heavily on which category the government is procuring under for any given equipment class, and the government's clear long term direction has been to push an increasing share of procurement toward the higher indigenous categories over time.