The European Union has taken a significant step towards bolstering its defence capabilities with the formal adoption of the European Defence Industry Programme (EDIP). This ambitious initiative aims to enhance the competitiveness and responsiveness of Europe’s defence technology industrial base, ensuring the EU is well-prepared to face current and future security challenges.
The adoption of EDIP marks the culmination of a rigorous legislative process, paving the way for its swift implementation. The programme is a cornerstone of the EU’s renewed commitment to defence readiness, designed to strengthen the ability of member states to address evolving threats. EDIP will also play a crucial role in enhancing the competitiveness of the European Defence Technology Industrial Base (EDTIB) and ensuring the timely availability and supply of defence products across the Union.
A substantial €1.5 billion in grants has been allocated for the period 2025-2027 under EDIP. Notably, €300 million of this amount is specifically earmarked for a dedicated Ukraine Support Instrument. This instrument aims to modernise and support Ukraine’s defence industry, fostering its integration into the broader European defence industrial ecosystem. The programme also allows for potential future budget reinforcements, including voluntary financial contributions from member states or third parties.
Under EDIP, the EU will fund several key areas:
1. **Common Procurement Actions**: These actions, carried out by at least three countries (with at least two being member states), will include the establishment and maintenance of defence industrial readiness pools. This initiative will streamline procurement processes and enhance collective defence capabilities.
2. **Industrial Reinforcement Actions**: These activities are designed to ramp up the production capacity of critical defence products, ensuring that the EU can meet its defence needs promptly and efficiently.
3. **European Defence Projects of Common Interest**: These collaborative industrial projects will contribute to the development of member states’ military capabilities, addressing critical security and defence interests of the Union.
4. **Supporting Actions**: These include activities to increase interoperability and interchangeability of defence systems, as well as efforts to facilitate access to the defence market for small and medium-sized enterprises (SMEs), mid-caps, and start-ups.
To safeguard and strengthen the EU defence industry while maintaining cooperation with like-minded international partners, the regulation includes a clause stipulating that components originating outside the EU and associated countries (EEA states), as well as Ukraine for the Ukraine Support Instrument, should not exceed 35% of the total component costs of the end product. Additionally, no components may be sourced from non-associated countries that conflict with the EU’s or member states’ security and defence interests.
The regulation also establishes the first EU-level security of supply framework, designed to reinforce defence supply-chain resilience and improve the EU’s ability to respond swiftly in times of crisis.
The regulation will be signed on 17 December 2025 and will enter into force the day following its publication in the Official Journal of the European Union.
This initiative underscores the EU’s strategic vision to create a robust and resilient defence industrial base, capable of meeting the security challenges of the 21st century. By fostering collaboration, innovation, and strategic investments, EDIP is poised to play a pivotal role in shaping the future of European defence.