Reliance and Diehl Signed ₹10,000 Crore Deal to Manufacture Precision Vulcano Artillery Shells in India

In a significant boost to India’s defence manufacturing ambitions, Reliance Defence has signed a major cooperation agreement with Germany’s Diehl Defence to locally produce the advanced Vulcano 155mm precision-guided ammunition. This landmark deal, valued at ₹10,000 crore, marks a vital step towards reducing India’s dependence on imported military hardware and strengthening the country’s indigenous defence capabilities.

A New Chapter in India’s Defence Production

Announced on 10 June, the agreement will see Reliance Defence, a subsidiary of Reliance Infrastructure, take charge of manufacturing the Vulcano system in India, while Diehl Defence will provide the cutting-edge technology and technical know-how. Production is planned at a newly established facility within the Dhirubhai Ambani Defence City (DADC) in the Watad Industrial Area, Ratnagiri, Maharashtra.

This is not just another manufacturing deal — it’s a strategic partnership designed to enable India’s Armed Forces to acquire world-class precision artillery shells produced domestically. It aligns with the Indian government’s broader “Aatmanirbhar Bharat” (Self-Reliant India) mission and the goal of achieving ₹50,000 crore in defence exports by 2029.

What is the Vulcano 155mm Precision-Guided Ammunition?

The Vulcano 155mm is an advanced artillery shell equipped with laser and GPS-guided targeting systems. It’s designed for long-range, high-accuracy strikes — a critical requirement for modern battlefields where precision can turn the tide of combat.

With a maximum range of up to 70 kilometres in its guided variant, the Vulcano offers a significant advantage over conventional artillery shells. Its ability to accurately hit high-value, time-sensitive targets with minimal collateral damage makes it an ideal weapon for both defensive and offensive operations.

Key Specifications of Vulcano 155mm:

• Calibre: 155mm

• Maximum Range:

  • Ballistic variant: 36-50 km

  • Guided variant: 70 km+

• Guidance: GPS and semi-active laser

• Accuracy: Circular error probable (CEP) of less than 5 metres

• Warhead Type: High-explosive fragmentation

• Compatible Platforms: NATO-standard 155mm howitzers, including India’s Dhanush and ATAGS

Economic and Strategic Impact

Reliance Defence estimates this project could generate up to ₹10,000 crore in revenue over the coming years. The facility will include over 50% indigenous value addition, directly contributing to domestic defence production growth and job creation in the Ratnagiri region.

This marks Reliance’s fourth major international defence tie-up after successful collaborations with Dassault Aviation, Thales Group, and Rheinmetall. Diehl Defence, known globally for its guided missile systems, air defence solutions, and precision ammunition, views this partnership as a long-term strategic relationship.

Geopolitical Undertones

While India celebrates this milestone, reports indicate that Diehl Defence has simultaneously been in quiet talks with Pakistan for its IRIS-T air defence system. The IRIS-T, which has proven effective in intercepting high-speed missiles like Russia’s P-800 Oniks, is being positioned as a counter to India’s BrahMos missile.

This dual-track defence diplomacy by Germany has raised eyebrows in strategic circles, reflecting the complexities of arms trade dynamics in South Asia.

Positive Market Reaction

Investors responded enthusiastically to the announcement, with Reliance Infrastructure’s stock climbing 3.5%, closing at ₹404.40 on the Bombay Stock Exchange. The market’s optimism highlights growing confidence in India’s expanding defence manufacturing sector and Reliance’s role within it.

The Reliance-Diehl partnership is more than a commercial agreement; it represents a pivotal move towards making India a hub for precision-guided ammunition. By producing world-class artillery systems like the Vulcano 155mm domestically, India not only strengthens its own defence preparedness but also positions itself as a potential exporter of high-precision munitions in the future.

This collaboration stands as a prime example of India’s defence sector transformation — driven by indigenous production, global technology partnerships, and strategic self-reliance.