EU Commits €1.6 Billion to Rebuild and Modernise European DefenceTech
The European Commission has launched two new funding programmes designed to fundamentally strengthen the European defence industry. With the European Defence Industry Programme (EDIP) and the new pilot instrument AGILE, Brussels is making a total of approximately €1.615 billion available to increase both industrial production capacity and the pace of technological innovation in Europe. The backdrop is the changed security situation in Europe, which has gained additional urgency as a result of Russia’s war of aggression against Ukraine.
EDIP: Broad-Based Industrial Strengthening
The European Defence Industry Programme (EDIP) was adopted on 8 December 2025 and encompasses a work programme of €1.5 billion for the period 2026 to 2027. The programme targets established industries, member states and public authorities, and pursues the goal of scaling existing production capacities, reducing fragmentation in European procurement, and deepening cooperation with Ukraine.
The funds are distributed across several priority areas. More than €700 million will flow into increasing production of drone defence systems, missiles and ammunition. Of this, €260 million is allocated to the Ukraine Support Instrument (USI), which finances the rebuilding of the Ukrainian defence industry and joint cooperation projects.
Investment Priorities at a Glance
- €325 million for European Defence Projects of Common Interest (EDPCI), open to EU member states, Norway and Ukraine
- €260 million via the Ukraine Support Instrument (USI) for rebuilding the Ukrainian defence industry
- €240 million for joint procurement, including drone defence, air and missile defence, and ground and maritime combat systems
- €100 million in equity support for defence start-ups and SMEs via the FAST fund
- €35.3 million for the BraveTech innovation programme to support Ukrainian and European start-ups
The first round of EDIP funding calls will be accessible from 31 March 2026 via the EU Funding and Tenders Portal. Consortia of public authorities can apply for grants of up to €20 million per project.
AGILE: Speed as a Principle
With AGILE, the European Commission is pursuing a fundamentally different approach. The €115 million pilot instrument is explicitly designed for disruptive defence technologies and is aimed primarily at start-ups, scale-ups and technology-driven SMEs. The stated goal is to bring innovations from the laboratory into deployment not in years, but in weeks or months.
“Russia’s war of aggression against Ukraine has shown that success on the battlefield now depends on short innovation cycles and the ability to develop, test and deploy new technologies and cost-efficient solutions in weeks or months rather than years.”
AGILE is intended to operate in areas such as artificial intelligence, quantum technology and drones. Particularly notable is the targeted pace of funding allocation: the Commission plans to award grants within just four months — an unusually short timeframe by EU funding standards. Technologies are expected to reach the armed forces within one to three years.
Key Features of AGILE
- Support for 20 to 30 projects with up to 100 percent of eligible costs covered
- Retroactive clause: expenditure incurred up to three months before the application deadline can be claimed
- Focus on deployment-oriented development and market introduction of disruptive defence goods
- Full alignment with the most pressing needs of EU member states
The proposal for a regulation establishing AGILE will be submitted to the European Parliament and the Council under the ordinary legislative procedure. The instrument is expected to be operational at the beginning of 2027.
Key Differences at a Glance
| Feature | EDIP | AGILE |
|---|---|---|
| Total volume | €1.5 billion | €115 million |
| Duration | 2026 to 2027 | From early 2027 (planned) |
| Target group | Industry, member states, public authorities, SMEs | Start-ups, scale-ups, technology-driven SMEs |
| Focus | Production capacity, procurement, industrial cooperation | Disruptive innovation, rapid market introduction |
| Innovation fields | Ammunition, missiles, drone defence, combat systems | AI, quantum technology, drones, digital technologies |
| Award speed | Standard procedure | Grant within four months |
| Funding rate | Variable, up to €20 million per project | Up to 100 percent of eligible costs |
| Ukraine involvement | Explicitly provided for (USI, BraveTech) | Not explicitly provided for |
Classification and Context
Both programmes are part of a broader EU strategy to strengthen its defence readiness. They complement existing instruments such as the European Defence Fund (EDF), the EU Defence Innovation Scheme (EUDIS), and the European Defence Agency’s innovation hub. Their foundation includes, among other things, the White Paper on European Defence Readiness 2030 and the EU Roadmap for Defence Industrial Transformation.
EDIP and AGILE pursue complementary objectives: while EDIP strengthens Europe’s industrial base on a broad front and expands existing capacities, AGILE is specifically designed to close the gap between research and deployment — a gap that is increasingly decisive in modern conflicts. Together, the programmes are intended to ensure that Europe is positioned to be both strong in production and technologically responsive.
