Defence Ministry Signs ₹4,106 Crore Deals for IAF's GSAT-7C Satellite and Navy's Varunastra Torpedoes

The Ministry of Defence on 15 October 2026 signed two contracts worth about ₹4,106 crore that cover two very different battlespaces: geostationary orbit and the deep ocean. One buys the Indian Air Force a dedicated communication satellite, GSAT-7C. The other buys the Indian Navy more Varunastra heavyweight anti-submarine torpedoes. Both are Indian-designed systems built by public-sector enterprises, and both go to domestic suppliers.

The two contracts

According to the ministry's announcement, carried by Business Standard, The Tribune, The Week and others, the contracts were signed in New Delhi in the presence of A. Anbarasu, Additional Secretary and Director General (Acquisition).

• GSAT-7C: ₹2,563 crore with NewSpace India Limited (NSIL), Bengaluru. NSIL is the commercial arm of the Department of Space. The ministry describes the satellite as indigenously designed, developed and manufactured, and says it will improve secure, resilient communication among IAF assets.
• Varunastra: ₹1,543 crore with Bharat Dynamics Limited (BDL), Hyderabad. Varunastra is an electrically propelled heavyweight torpedo designed to engage enemy submarines in both deep and shallow waters. It was developed by DRDO's Naval Science and Technological Laboratory (NSTL) in Visakhapatnam.

The two figures add up exactly to the ₹4,106 crore headline. The ministry framed both deals as part of the Aatmanirbhar Bharat push to build domestic capability in critical areas and reduce dependence on foreign suppliers.

GSAT-7C: the IAF gets its own satellite

India's military satellite communication has been built up one satellite at a time. GSAT-7, launched in 2013, serves the Navy. GSAT-7A, launched on GSLV-F11 on 19 December 2018, carried capacity for the Air Force. But according to The Tribune, the IAF has so far had to share satellite transponder capacity with the Navy and the Army. A dedicated satellite gives it guaranteed bandwidth for linking aircraft, ground radars, airbases and command centres.

The programme has been a long time coming. The Defence Acquisition Council approved the Acceptance of Necessity (AoN) for GSAT-7C on 23 November 2021, when the project was estimated at about ₹2,236 crore. The signed contract, at ₹2,563 crore, moves it from approval to execution. Reports of the signing did not give a launch date or delivery schedule.

For India's space ecosystem, the contract also shows NSIL taking on a defence customer directly. Military demand of this kind gives ISRO's commercial arm, and the Indian suppliers in its chain, a steady order book that civilian commercial demand alone may not yet provide.

Varunastra: a home-grown answer under the sea

Varunastra is one of the more mature products of India's naval weapons programme. Publicly available specifications describe a torpedo of about 1.5 tonnes that can reach speeds above 40 knots and carry a conventional warhead of around 250 kg. The Indian Navy lists its length as 7.78 metres and its diameter as 533.4 mm, the standard heavyweight-torpedo calibre. The Week describes it as a ship-launched anti-submarine torpedo intended to let the Navy engage submarines at long range.

BDL separately told the stock exchanges on 15 October that it had signed a contract with the Indian Navy for heavyweight torpedoes worth about ₹1,307 crore excluding taxes, to be completed within 42 months, according to Business Today and PSU Watch. By our arithmetic, ₹1,307 crore plus 18 per cent GST comes to about ₹1,542 crore, close to the ministry's ₹1,543 crore. That suggests the two numbers describe the same order on different bases, though neither the ministry nor BDL stated this explicitly.

The order is significant for what it says about the torpedo's maturity. An order of this size, placed with the production agency rather than the design lab, shows that the weapon is firmly in series manufacture. NSTL remains the design authority. BDL, which also makes missiles and other underwater weapons, carries out industrial production. That division of labour, with DRDO designing and a production partner manufacturing at scale, is the model the ministry wants to replicate across more of its programmes.

For the Navy, a domestic production line also changes the logistics. Heavyweight torpedoes are expensive, maintenance-intensive weapons that need periodic overhaul and a ready reserve. Buying them from an Indian factory means spares, upgrades and replenishment in wartime do not depend on a foreign government's approval.

Why these two deals matter together

At first glance a satellite and a torpedo have little in common. What links them is the model of acquisition:

• Indian design authority. GSAT-7C comes out of the Department of Space ecosystem, and Varunastra comes from a DRDO laboratory. In both cases the intellectual property and design knowledge sit in India.
• Public-sector production with private supply chains. NSIL and BDL are the prime contractors, but both rely on networks of Indian private suppliers for components, sub-systems and assembly. Each multi-year order sustains those suppliers.
• Strategic autonomy. Satellite communications and anti-submarine weapons are both areas where reliance on foreign suppliers creates risk in a crisis, whether through denied bandwidth, restricted spares or export controls.

What to watch next

The key milestones now are a launch date for GSAT-7C and the delivery schedule for the Varunastra torpedoes, which BDL says it will complete within 42 months. Watch too for whether the IAF's dedicated capacity lets the ministry rebalance the bandwidth now shared across services. With defence space and undersea warfare both drawing more attention, more orders of this kind are likely over the coming year.

Sources

• Business Standard: https://www.business-standard.com/india-news/defence-ministry-signs-4-106-cr-deals-for-iaf-satellite-navy-torpedoes-126101500956_1.html
• The Tribune: https://www.tribuneindia.com/news/defence/iaf-to-get-its-own-satellite-as-defence-ministry-signs-rs-2563-crore-deal/
• The Week: https://www.theweek.in/news/defence/2026/10/15/eyes-in-space-more-firepower-underwater-how-indias-4106-crore-defence-deals-will-boost-iaf-navy.html
• The Sunday Guardian: https://sundayguardianlive.com/news/mod-signs-rs-4106-crore-contracts-for-iaf-communication-satellite-navys-varunastra-torpedoes-306329/
• UNI: https://www.uniindia.com/national/defence-iaf-satellite-navy-varunastra/214912
• Business Today (BDL filing): https://www.businesstoday.in/markets/stocks/story/bharat-dynamics-wins-order-worth-rs-1307-crore-from-indian-navy-561843-2026-10-15
• PSU Watch: https://psuwatch.com/defencewatch/bdl-bags-rs-1307-crore-indian-navy-contract-for-heavyweight-torpedoes
• Wikipedia, GSAT-7C: https://en.wikipedia.org/wiki/GSAT-7C
• Wikipedia, Varunastra: https://en.wikipedia.org/wiki/Varunastra_(torpedo)
• Satellite Today (GSAT-7A launch): https://www.satellitetoday.com/launch/2018/12/20/isro-launches-gsat-7a-communications-satellite/