It said the Army's infantry school in Mhow and the DRDO's Armament Research and Development Establishment (ARDE) in Pune have designed and developed the weapon.
The ministry said the weapon has been developed in a record time of four months.
"The machine pistol fires the in-service 9mm ammunition and sports an upper receiver made from aircraft grade aluminium and lower receiver from carbon fibre. 3 dimensional printing process has been used in designing and prototyping of various parts," it said in a statement.
It said the weapon has huge potential in armed forces as personal weapon for various missions, including in counter insurgency and counter terrorism operations.
"The machine pistol is likely to have production cost under Rs 50,000 each and has potential for exports," it said.