The European Commission has approved a €1.5 billion funding programme aimed at strengthening and modernising Europe’s defence industry, marking a major step in the bloc’s
push to improve security and military readiness.
The initiative, launched under the European Defence Industry Programme (EDIP), focuses on increasing production capacity, advancing military technology and reinforcing Europe’s resilience in an increasingly unstable global security environment.
A key pillar of the programme is closer cooperation with Ukraine, reflecting the European Union’s long-term strategic commitment to supporting Kyiv while integrating its defence sector more closely with Europe.
More than €700 million of the funding will be directed towards ramping up production of critical defence equipment, including missile systems, ammunition and counter-drone technologies. Of this, €260 million will be channelled through a dedicated Ukraine Support Instrument to help rebuild and modernise Ukraine’s defence industrial base. The funding is expected to support joint projects that expand production capabilities across both Ukraine and EU member states.
In parallel, €325 million will be allocated to large-scale collaborative defence projects under the European Defence Projects of Common Interest. These initiatives are designed to reduce fragmentation in Europe’s defence sector and encourage cross-border industrial cooperation. Notably, the programme is also open to participation from Norway and Ukraine, further underlining the EU’s effort to build a broader security ecosystem.
To improve efficiency and reduce duplication among member states, €240 million will support joint procurement of defence equipment. This includes investments in air and missile defence systems, counter-drone technologies, and both naval and ground combat capabilities. Funding will be available to multinational consortia, with individual projects eligible for grants of up to €20 million.
The programme also places strong emphasis on innovation. Around €100 million will be invested in defence start-ups and small and medium-sized enterprises through a dedicated equity fund designed to strengthen supply chains. In addition, the BraveTech EU initiative will receive €35.3 million to accelerate defence innovation, particularly in areas that address urgent operational needs identified by the Ukrainian armed forces.
The first calls for project proposals are expected to be published on 31 March 2026 via the EU’s Funding & Tenders Portal.
The EDIP programme, adopted in December 2025, forms part of a broader effort by the European Union to adapt its defence capabilities to a rapidly changing security landscape.
EU–Ukraine relationship context
The strong emphasis on Ukraine within this programme reflects a significant shift in EU policy since the Russian invasion of Ukraine. What began as emergency military and financial assistance has evolved into a deeper, structural partnership.
The EU is no longer only supplying weapons—it is actively helping Ukraine rebuild its defence industry and integrate it into the European defence ecosystem. This has long-term implications: Ukraine could become a key defence production hub for Europe, given its battlefield experience, industrial capacity and urgent need for innovation.
At the same time, cooperation through programmes like EDIP strengthens Ukraine’s path toward closer political and economic integration with the EU. While full membership remains a longer-term prospect, defence collaboration is emerging as one of the fastest-moving areas of alignment.
For the EU, this partnership also serves a strategic purpose: enhancing its own defence capabilities while supporting a frontline state that is central to European security.