New Initiative to help accelerate business opportunities in Canada’s defence sector supply chains

From: Federal Economic Development Agency for Southern Ontario

News release

Eligible businesses can now apply to the Regional Defence Investment Initiative to scale up, improve productivity and access supply chain opportunities

December 5, 2025 – Toronto, Ontario

A strong and competitive defence industry is essential to Canada’s sovereignty, security, and long-term economic prosperity. Southern Ontario is home to a dynamic defence ecosystem, with strengths in advanced manufacturing, aerospace, automotive technologies, cybersecurity, robotics and AI. The region is well-positioned to seize new defence opportunities and strengthen its role in global supply chains.

Today, at the Downsview Aerospace Innovation and Research hub in Toronto, the Honourable Evan Solomon, Minister of Artificial Intelligence and Digital Innovation and Minister responsible for the Federal Economic Development Agency for Southern Ontario (FedDev Ontario), announced that the Regional Defence Investment Initiative (RDII) is now open in southern Ontario.

The RDII is a $357.7-million initiative, delivered by Canada’s regional development agencies, which aims to accelerate the integration of businesses and regional ecosystems into domestic and international defence supply chains while increasing their industrial and innovation capacity. This includes investment in businesses whose products and services are dual-use, or who seek to pivot their activities to supply the defence sector. FedDev Ontario’s allocation through this national initiative is $94.7 million.

In addition, understanding the critical importance of the defence sector in the region, FedDev Ontario is allocating an additional $106 million from existing resources to total nearly $200 million in defence support.

To learn more about how to apply, visit the Regional Defence Investment Initiative in southern Ontario.

Quotes

“Southern Ontario is a powerhouse for defence-related manufacturing and innovation – with an ecosystem of innovative companies ready to deliver advanced technologies and regional expertise needed to strengthen Canada’s defence industrial base and enhance national security. Through the Regional Defence Investment Initiative, we are unlocking new opportunities for Canadian businesses to integrate into domestic and international defence supply chains, scale their technologies, and strengthen Canada’s national security.”
– The Honourable Evan Solomon, Minister of Artificial Intelligence and Digital Innovation and Minister responsible for the Federal Economic Development Agency for Southern Ontario

“This aerospace hub is an example of the talent and potential we have here in the Greater Toronto Area and across southern Ontario to boost the competitiveness of the defence sector. The investments and the collaborations that will come with support through the Regional Defence Investment Initiative will help ensure long-term economic prosperity for the industry and the country."
– Jean Yip, Member of Parliament for Scarborough−Agincourt, Ontario

Quick facts

Southern Ontario is home to more than 900 defence-capable organizations, anchored by major clusters in the Greater Toronto Area, Ottawa, and London, and is one of the country’s most dynamic centres for defence innovation.
As announced in Budget 2025, the Government of Canada has put into action initial investments to support Canada's defence industrial base by allocating $6.6 billion over five years on a cash basis, starting in 2025-26 under the forthcoming Defence Industrial Strategy.
These initial investments will drive research and innovation, strengthen domestic supply chains, grow critical resource stockpiles, and improve access to funds for Canadian small- and medium-sized defence businesses.
Visit FedDev Ontario’s website to learn more about the Regional Defence Investment Initiative in southern Ontario.

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