The global order is shifting. The rules-based system that has underpinned decades of relative stability is eroding, while technological breakthroughs are expanding the very domains in which conflict can unfold — from cyber and space to autonomous systems and artificial intelligence.
Against this backdrop, Prime Minister Mark Carney has launched what his government describes as a generational reset: Canada’s first-ever Defence Industrial Strategy.
It is not simply a procurement reform. It is not merely an industrial policy. It is a structural repositioning of Canada’s security, economy, and sovereignty.
And it comes with numbers that signal scale: more than half a trillion dollars in investment over the coming decade.
A Strategic Pivot
Canada’s defence procurement system has long faced criticism for being slow, complex, and heavily reliant on foreign suppliers. The result, the government argues, has been limited growth for domestic industry and delayed delivery of critical capabilities to the Canadian Armed Forces (CAF).
Now, the approach is changing.
Canada is on track to meet its 2% NATO spending target this fiscal year, with applications to join the CAF rising nearly 13%. But the government’s position is clear: spending more is not enough. How Canada spends matters just as much.
The Defence Industrial Strategy seeks to transform procurement into an engine of economic growth and strategic autonomy by prioritizing Canadian suppliers, accelerating innovation, and creating predictable demand for domestic industry.
Prime Minister Carney framed the initiative as foundational to Canada’s future:
“The work of defending Canada is the work of building Canada. Security and prosperity are mutually reinforcing foundations of the true North, strong and free. Our new Defence Industrial Strategy ensures Canada remains a sovereign nation, in charge of its own destiny. That’s Canada strong, and that’s what we are building, together.”
— The Rt. Hon. Mark Carney, Prime Minister of Canada
The Economic Engine Behind Security
The strategy positions Canadian industry to capture:
- $180 billion in defence procurement opportunities
- $290 billion in defence-related capital investment
- $125 billion in downstream economic benefit by 2035
The projected impact includes:
- 125,000 high-paying careers
- 50% growth in defence exports
- 70% of defence acquisitions awarded to Canadian firms
- 240% growth in Canadian defence industry revenues
Operational targets are equally ambitious. Within a decade, the government aims to raise fleet serviceability levels to:
- 75% for maritime fleets
- 80% for land fleets
- 85% for aerospace fleets
This is not only about jobs and contracts. It is about readiness.
Minister of National Defence David J. McGuinty underscored the urgency:
“Today’s announcement reflects the government’s clear commitment to ensuring Canada has secure, timely, and reliable access to the capabilities required to defend our country, protect our sovereignty, and confront current and future threats. This is the time to be ambitious. By investing in Canada’s future, we are strengthening the Canadian Armed Forces’ ability to defend, deter, and defeat threats to Canada and Canadians – an investment we cannot afford to miss.”
— The Hon. David J. McGuinty, Minister of National Defence
The Defence Investment Agency: From Red Tape to Results
Central to the strategy is the creation of the Defence Investment Agency (DIA).
Designed to streamline acquisition processes, reduce bureaucratic friction, and accelerate delivery timelines, the DIA will prioritize Canadian manufacturing, strengthen strategic partnerships, and lead Canada’s participation in joint procurement initiatives.
Secretary of State (Defence Procurement) Stephen Fuhr emphasized delivery:
“With the launch of this strategy and the Defence Investment Agency, we are delivering the capabilities the Canadian Armed Forces need, when they need them, while growing Canada’s economy. By investing in our defence industrial base, we can build stronger supply chains, drive innovation, and create up to 125,000 good-paying jobs for Canadians.”
— The Hon. Stephen Fuhr, Secretary of State (Defence Procurement)
Doug Guzman, Chief Executive Officer of the DIA, framed the agency’s operational mandate:
“The Defence Industrial Strategy strengthens Canada’s capacity to deliver critical capabilities to the Canadian Armed Forces with greater speed, certainty, and strategic coherence. It supports the Defence Investment Agency’s mandate by enabling more agile procurement and more secure, resilient supply chains. Through a coordinated, whole-of-government approach, the DIA is well positioned to support Canadian industry and ensure Canada can meet its evolving defence requirements with confidence and credibility.”
— Doug Guzman, Chief Executive Officer, Defence Investment Agency
Five Pillars: Build. Partner. Buy.
At its core, the strategy is anchored by five pillars.
1. Position Canada as a Leader in Defence Production
The guiding principle: Buy Canadian.
Canada will:
- Build domestically in areas of sovereign strength — shipbuilding, aerospace, space, land systems, digital technologies.
- Partner with trusted allies where joint capability makes strategic sense.
- Buy from allies only when necessary, with reinvestment and sovereign control conditions attached.
The objective is clear: reduce overreliance on foreign suppliers, secure intellectual property control, and create national champions.
Minister of Industry Mélanie Joly described the broader economic rationale:
“At a time of growing global uncertainty, Canada must strengthen its economic security and protect its sovereignty by investing at home. Canada’s new Defence Industrial Strategy will grow our domestic industrial base, create high-quality jobs in every region of the country, and position Canadian companies to compete and win globally. By building, innovating, and manufacturing in Canada, we are ensuring our industries benefit directly from defence investments while supporting the modernisation of the Canadian Armed Forces. Our government is meeting the moment for Canadians by driving growth, creating jobs across the country, and ensuring Canadians benefit from a stronger, more resilient defence economy.”
— The Hon. Mélanie Joly, Minister of Industry
2. Break Down Barriers Between Government and Industry
The strategy establishes:
- A permanent Defence Advisory Forum
- Accelerated security clearance processes
- Reduced barriers to entry for industry growth
3. Scale Innovation and Export It
Key investments include:
- $4 billion Defence Platform at the Business Development Bank of Canada
- $379.2 million Regional Defence Investment Initiative
- $656.9 million for defence and dual-use technology development
- $105 million Drone Innovation Hub at the National Research Council
- $459 million aircraft platform for R&D and technology qualification
- Creation of BOREALIS (Bureau of Research, Engineering and Advanced Leadership in Innovation and Science)
- A new Science and Research Defence Advisory Council
- Dedicated defence export promotion team
- Expanded trade commissioner presence in the U.K. and key EU markets
The strategy also reinforces Canada’s leadership ambitions in artificial intelligence, quantum, space, and other frontier technologies.
4. Protect Workers and Supply Chains
The new Canadian Defence Industry Resilience Program will increase domestic production capacity — including nitrocellulose production for artillery.
A Canada Defence Skills Agenda will strengthen the talent pipeline, expand skilled worker supply, and partner with provinces, territories, and Indigenous rights holders.
5. A Whole-of-Country Effort
The strategy commits to coordinated engagement with provinces, territories, and Indigenous partners — particularly in the North and Arctic — alongside accelerated critical minerals development aligned with allied defence needs.
Christyn Cianfarani, President and CEO of CADSI, described the moment as catalytic:
“This is an ambitious, landmark strategy that shows real leadership at a time of profound uncertainty and change. It’s a rallying cry – for the public service and the Department of National Defence to execute, and for industry to deliver on a new vision for Canada’s defence, economic resilience, and national security. Today’s outcome is an example of what’s possible when the public and private sectors listen to each other, and work toward the same goals.”
— Christyn Cianfarani, President and Chief Executive Officer, CADSI
A Jobs Strategy — and a Sovereignty Strategy
Ultimately, the Defence Industrial Strategy is framed as both an economic growth plan and a national security doctrine.
It links steel and aluminum welders to AI researchers. It connects Arctic mineral projects to advanced aerospace manufacturing. It ties fleet serviceability metrics to export expansion.
It is an assertion that sovereignty in the 21st century is built not only on military strength — but on industrial depth, innovation capacity, and economic resilience.
In the government’s view, defending Canada means building Canada.
And now, that mission has a blueprint.