State protects forged steel instrument (7)
I believe the answer is:
celesta
'instrument' is the definition.
(I know that celesta is a type of keyboard instrument)
'state protects forged steel' is the wordplay.
'state' becomes 'ca' (abbreviation for California).
'protects' is an insertion indicator (outer letters protect inside letters).
'forged' indicates anagramming the letters.
'steel' anagrammed gives 'elest'.
'ca' placed around 'elest' is 'CELESTA'.
(Other definitions for celesta that I've seen before include "one giving out notes" , "Keyboard percussion instrument giving a bell-like sound" , "a bunch of keys?" , "Musical instrument" , "Play this" .)