(This was originally posted in The Tribune by Vijay Mohan)
No outsider would be appointed to the Board of Directors in the newly corporatized Ordnance Factory Board (OFB) and appointments thereof, for the time being, would be made from within establishments under the Ministry of Defence (MoD).
“The first set of Board of Directors of the corporate entity (ies) is to be appointed from the serving senior officials of the OFB/Department of Defence Production, Armed Forces, Controller General of Defence Accounts and the existing nine defence public sector undertakings,” a note issued by the planning wing of the Department of Defence Production states.
On June 17, the Union Cabinet had approved the corporatization of the OFB, resulting in its 41 factories being subsumed as seven defence public sector undertakings owned 100 percent by the government.
The Ministry of Defence has sought the list of officers fulfilling the eligibility criteria, who opt to join the newly created companies, from the aforementioned departments by June 30.
The selected officers would be placed on deemed deputation to the new corporate entities but without deputation allowance. They would be governed on terms applicable for foreign service and would be subject to service rules and regulations such as pay and allowances, leave and career progression as applicable to them in their parent cadre, the note adds.
Headquartered at Kolkata, the OFB is the oldest and the largest organisation in the country’s defence industry, dating back to 1787 when a gunpowder factory was established by the British at Ishapore.
They produce a vast array of equipment for the armed forces, para-military organizations, and to a limited extent, the civilian market.
This includes weapons and ammunition, soft-skin vehicles, armoured vehicles, personal equipment and clothing, parachutes, opto-electronic devices, surveillance equipment and ancillary items.
Under the new scheme of things, the 41 factories have been converted into seven defence public sector undertakings. Ammunition and Explosives, headquartered at Khadki, will take over 12 factories, while Weapons and Equipment, headquartered at Kanpur, and Ancillary, headquartered at Ambajhari, will get eight factories each.
Vehicles, headquartered at Avadi, will get five factories, Troop Comfort Items, headquartered at Kanpur, will get four. Opto-electronics, headquartered at Dehradun will get three, while Parachute at Kanpur will comprise a single unit.
The plan for the corporatization of the OFB was conceived about two decades ago to revitalize and streamline the functioning of the factories which have often drawn fire from Parliament’s Standing Committee on Defence and the Comptroller and Auditor General of India oversight over the poor quality of products, mismanagement, delayed timelines and lack of technological advancements.
According to latest figures compiled by the MoD, the total manpower in OFB as on February 1, 2021 was 74,085 and the revenue generated in 2020 was Rs 12,755 crore. Arms and Explosives had the lion’s share in both, with 24,436 employees and a revenue of Rs 4,348 crore.