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The Strategic Overhaul of India’s Defence Sector: Disbanding the Ordnance Factory Board
The Historic Foundation of the Ordnance Factory Board:
The inception of the Ordnance Factory Board (OFB) in 1801 marked a significant milestone in India’s defence history. Established under the East India Company at Fort William, Kolkata, the OFB was not just a manufacturing entity, it symbolized the consolidation of British military, economic, and political dominance in colonial India. Over the centuries, this institution evolved into a robust backbone for the Indian armed forces, paramilitary, and police forces, supplying a broad spectrum of military equipment. From tanks, armoured vehicles, and rifles to advanced optical and electronic devices, the OFB has been instrumental in equipping India’s defence forces with crucial hardware.
Evolution and Expansion of the OFB:
In 1979, the entity was rechristened as the ‘Ordnance Factory Board’, representing a significant evolution from its colonial-era origins. The OFB’s journey from a colonial armament production unit to a modern defence manufacturing giant reflects India’s aspirations for self-reliance in defence production. With an annual turnover approximating Rs 19,000 crore, the OFB’s contribution to India’s strategic autonomy has been substantial. However, despite its storied past and contributions, the OFB has faced challenges such as inefficiencies, high production costs, and managerial rigidity, necessitating a strategic overhaul.
Decoding the Decision to Dismantle
The Genesis of the Dissolution Plan:
The decision to dissolve the OFB was the culmination of a long-standing government objective to enhance the efficiency and efficacy of India’s defence manufacturing sector. This objective gained momentum post the 2019 Lok Sabha election, signalling a shift towards a more modern, agile, and competitive defence production paradigm. Finance Minister Nirmala Sitharaman, in her May 2020 ‘Aatmanirbhar Bharat’ (Self-Reliant India) announcements, highlighted this strategic shift. The envisioned transformation aimed to dismantle the bureaucratic structure of the OFB, replacing it with a more streamlined, autonomous, and accountable system.
The Path to Corporatization:
An Empowered Group of Ministers (EGoM), under the chairmanship of Defence Minister Rajnath Singh, was constituted to meticulously guide this transition. The EGoM’s responsibilities encompassed a range of critical aspects, from ensuring seamless operational continuity to safeguarding employee interests. In June 2021, the Indian government announced the division of the OFB into seven distinct defence public sector units (DPSUs), a decision that was ratified by the Cabinet Committee on Security in July 2020. This strategic division aimed at enhancing operational flexibility and market responsiveness of India’s defence production capabilities.
The New Horizon: Seven DPSUs:
The restructuring process birthed seven DPSUs, each specializing in different aspects of defence manufacturing. These new entities, including Munitions India, Armoured Vehicles Nigam, and Advanced Weapons and Equipment India, among others, are poised to operate as autonomous corporate entities. This structural reformation is expected to infuse a new spirit of competitiveness and innovation, propelling India’s defence sector into a new era of efficiency and global competitiveness.
(1) Yantra India Lmited
Units of Yantra India Limited, Ministry of Defence, A Government of India Enterprise
- Grey Iron Foundry Jabalpur (GIF)
- Metal & Steel Factory (MSF)
- Ordnance Factory Ambarnath (OFA)
- Ordnance Factory Ambajhari (OFAJ)
- Ordnance Factory Bhusawal (OFBH)
- Ordnance Factory Dum Dum (OFDC)
- Ordnance Factory Katni (OFKAT)
- Ordnance Factory Muradnagar (OFM)
(2) Munitions India Limited
Units of Munitions India Limited, Ministry of Defence, A Government of India Enterprise
- Ammunition Factory Kirkee (AFK)
- Cordite Factory Aravankadu (CFA)
- High Energy Projectile Factory, Tiruchirapalli (HEPF)
- High Explosive Factory Kirkee (HEF)
- NADP (NADP)
- Ordnance Factory Bhandara (OFBA)
- Ordnance Factory Bolangir (OFBOL)
- Ordnance Factory Chanda (OFCH)
- Ordnance Factory Dehu Road (OFDR)
- Ordnance Factory Itarsi (OFI)
- Ordnance Factory Institute of Learning, Khamaria (OFILKH)
- Ordnance Factory Khamaria (OFK)
- Ordnance Factory Project Nalanda (OFN)
- Ordnance Factory Varangaon (OFV)
(3) Gliders India Limited
Unit of Gliders India Limited, Ministry of Defence, A Government of India Enterprise
- Ordnance Parachute Factory Kanpur (OPF)
(4) Advanced Weapons and Equipment India Limited
Unit of Advanced Weapons and Equipment India Limited, Ministry of Defence, A Government of India Enterprise
- Field Gun Factory Kanpur (FGK)
- Gun Carriage Factory Jabalpur (GCF)
- Gun & Shell Factory Cossipore (GSF)
- Ordnance Factory Kanpur (OFC)
- Ordnance Factory Institute of Learning, Ichapore (OFILIS)
- Ordnance Factory Institute of Learning, Kanpur (OFILKN)
- Ordnance Factory Project, Korwa (OFPKR)
- Ordnance Factory Tiruchirapalli (OFT)
- Rifle Factory Ishapore (RFI)
- Small Arms Factory Kanpur (SAF)
(5) Troop Comforts Limited
Unit of Troop Comforts Limited, Ministry of Defence, A Government of India Enterprise
- Ordnance Clothing Factory Avadi (OCFAV)
- Ordnance Clothing Factory Shahjahanpur (OCFS)
- Ordnance Equipment Factory Kanpur (OEFC)
- Ordnance Equipment Factory Hazratpur (OEFHZ)
(6) Armoured Vehicles Nigam Limited
Unit of Armoured Vehicles Nigam Limited, Ministry of Defence, A Government of India Enterprise
- Engine Factory Avadi (EFA)
- Heavy Vehicle Factory, Avadi (HVF)
- Machine Tool Prototype Factory Ambarnath (MPF
- Ordnance Factory Board, Mumbai Office (OFBMO)
- Ordnance Factory Institute of Learning, Ambarnath (OFILAM)
- Ordnance Factory Institute of Learning, Avadi (OFILAV)
- Ordnance Factory Institute of Learning, Medak (OFILMK)
- Ordnance Factory Project Medak (OFPM)
- RCSAV (RCSAV)
- RCSNR (RCSNR)
- RMCAV (RMCAV)
- Vehicle Factory Jabalpur (VFJ)
(7) India Optel Limited
Unit of India Optel Limited, Ministry of Defence, A Government of India Enterprise
- Ordnance Factory Chandigarh (OFCd)
- Ordnance Factory Dehradun (OFDUN)
- Opo-Electronic Factory Dehradun (OLF)
The Employees Perspective and Future Prospects
The transition, while strategically sound, has raised concerns among the OFB workforce, particularly regarding job security and the operational viability of the new corporate entities. However, the government has assiduously addressed these concerns, ensuring that the employees’ service conditions and benefits remain unaffected. The corporatization move is perceived as a critical step in modernizing India’s defence production, drawing parallels with the transformative agricultural and dairy revolutions of the past. The government envisions these changes as a catalyst for fostering public-private partnerships, enhancing India’s defence capabilities, and positioning Indian defence manufacturers on the global stage.
Opportunities for New Aspirants:
For new job aspirants, this transformation in the defence sector represents a chance to be part of a dynamic and evolving field. The demand for diverse skill sets, ranging from engineering, research and development, to project management and logistics, is likely to increase. Additionally, the emphasis on public-private partnerships could mean greater collaboration with leading private sector players, thereby expanding the scope for employment and career growth in both public and private domains.
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Embracing a New Era in Defence Manufacturing
The dissolution of the Ordnance Factory Board and its reconstitution into seven specialized DPSUs marks a pivotal shift in India’s defence narrative. This move is not just about restructuring an organization; it’s about realigning India’s defence manufacturing philosophy with contemporary global standards. As the nation embarks on this journey, the transformation promises to redefine India’s defence production capabilities, making them more agile, innovative, and competitive. This strategic overhaul is a bold leap towards achieving India’s long-cherished goal of self-reliance in defence manufacturing, reinforcing its position as a global defence player.