Any talk about defense modernization is a non starter without serious focus defense indigenization. India cannot have a modern military, without a domestic defense industrial base. While China has always had the advantage of an efficient public sector, even in defense, India's chronically inefficient public sector means, we need to help accelerate the process of capacity building in the private sector.
Instead of allocating a lions share defense research funding to DRDO, ensure an equal share of the funds go towards projects that private sector wants to take up. Initially, as capacity building phase, let private sector pick easily deliverable products like assault rifles, infantry combat systems etc. But govt would need to guarantee that the order would only go to an Indian private sector. Once they have proved their capacity, they will be encouraged to for big ticket systems...
India is probably the only major power in the world with a woefully inadequate domestic defense industry. Why is DRDO involved in everything from small arms. MBT's, missiles, jet aircrafts, submarines, spacecraft. This is a project management nightmare.