India to Set Up Defence Joint Venture Company in Philippines

India and the Philippines have agreed to explore closer defence industrial cooperation through a new Memorandum of Understanding (MoU) signed between Indian defence manufacturer SMPP Limited and the Philippines-based Asia Defence and Firepower Corporation (ADFC).

The agreement outlines plans to set up a joint venture company (JVC) in the Philippines focused on assembling and distributing select defence products, tailored to meet Manila’s Self-Reliant Defence Posture (SRDP) goals. The move aligns with both countries’ efforts to enhance regional partnerships and strengthen local defence capabilities.

Supporting the Philippines’ Domestic Defence Agenda

The proposed JVC is expected to be majority-owned by Filipino stakeholders, enabling it to qualify for benefits under the CREATE Act, such as tax incentives and streamlined approvals. It also positions the venture to receive direct defence contracts under Republic Act No. 12009, which allows the Philippine Department of National Defence (DND) to award contracts to local firms without public bidding.

SMPP, which has supplied protective systems to Indian forces for some time, will bring in technical expertise, manufacturing processes, and quality assurance systems. ADFC will handle local operations, including staffing, facility development, and engagement with relevant government stakeholders.

“This is a practical step in sharing proven Indian defence technology with a friendly nation while supporting local capability-building,” said Ashish Kansal, CEO of SMPP Limited. “It reflects the spirit of Atmanirbhar Bharat as we engage constructively with international partners.”

Economic and Strategic Implications

While the MoU does not represent a major strategic shift, it signals a gradual broadening of India’s defence-industrial engagement in Southeast Asia. The partnership also supports the Philippines’ long-standing goal of reducing dependency on foreign imports by developing in-country manufacturing and technical skills.

“This collaboration complements our SRDP objectives and has the potential to generate employment and expand local technical expertise,” said Jeruel D. Sanchez, President and CEO of ADFC.

The development comes as India and the Philippines explore wider cooperation in renewable energy, education, health services, and digital infrastructure, areas discussed at the leadership level during President Ferdinand Marcos Jr.’s recent state visit.

Growing Defence Ties

India and the Philippines have previously cooperated on defence procurement, including the BrahMos missile deal, and have engaged in joint maritime security dialogues. While this MoU is an early-stage industrial initiative, it adds to the growing portfolio of practical cooperation between the two nations in the Indo-Pacific region.

Team BharatShakti