On July 3, 2025, defence stocks in India, including those of Hindustan Aeronautics Limited (HAL), BEML, and Paras Defence, rallied after India and the United States announced plans to sign a 10-year defence framework. The agreement aims to deepen strategic and industrial defence cooperation. Defence Minister Rajnath Singh also pushed for faster delivery of GE engines and joint production plans with US defence giant GE Aerospace.
Defence stocks in India rallied on Thursday, July 3, after the governments of India and the United States agreed to sign a 10-year defence framework aimed at deepening bilateral military and industrial ties.
Hindustan Aeronautics Limited (HAL), a state-owned aerospace and defence firm based in Karnataka, rose over 1% alongside BEML Ltd. and Paras Defence and Space Technologies, following the announcement by the Pentagon regarding the upcoming framework agreement.
The news lifted the Nifty India Defence Index by 0.65%, with Data Patterns (India), Cyient DLM, Dynamatic Technologies, and Mazagon Dock Shipbuilders also among the top gainers.
The agreement, confirmed by a Pentagon statement released on Wednesday, comes after a phone call between Defence Minister Rajnath Singh and US Secretary of Defense Pete Hegseth. The officials agreed to sign the updated framework during their next meeting in 2025.
During the conversation, Singh also urged expedited delivery of GE F404 engines for India’s indigenous Tejas Light Combat Aircraft and called for early finalization of the proposed joint production of GE F414 jet engines in collaboration with GE Aerospace and HAL.
According to sources, both sides discussed pending major US defence sales to India and emphasized the need for close defence industrial cooperation.
While many defence stocks climbed, some names like Bharat Dynamics, Mishra Dhatu Nigam, Astra Microwave Products, and DCX Systems declined by more than 0.5%.
As India intensifies its push toward domestic defence manufacturing and technology partnerships with Western allies, investors appear increasingly confident in the sector’s growth prospects, especially in light of long-term frameworks like this one.
