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OFB Corporatization: Is it out of the woods?
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OFB Corporatization: Is it out of the woods?

“If everybody else seems to be doing it one way, there might be more opportunity doing the other way”---- Andrew Scheuermann

Post by on Friday, January 14, 2022

First slide

Ever since the LAC standoff between India and China was blown full in the face of the country, it woke up to its onerous responsibility of dusting off the files of MOD appointed Kelkar committee in 2005 of corporatization of this behemoth known as the OFB (Ordnance factory board) which unfortunately was kept on the back burner due to reasons best known to the Mandarins of power. It has always been the wont of this country to take up the last call for its own safety and security overriding expert’s opinion to its own detriment. About six months back GOI promulgated EDSO (Essential defence services ordnance) making it illegal for the 70000 plus workers and officers running the network of the 41 ordnance factories across the country to strike work against the government decision to corporatize the OFB that administer these factories and other associated organisations. Accordingly OFB marched into history in October this year when 41 production units under its realm along with the entire paraphernalia consisting of its assets, employees, officers, operations, maintenance & management control were transferred to 07 different DPSUs (Defence public sector undertaking) viz, Munitions India limites, Armoured vehicles Nigam limited, Advance weapon and equipment limited, Troops comfort limited, Yantra India limited, India optics limited and Gliders India limited.

The OFB now headquartered at “Ayudh Bhavan” in Kolkatta dates back to the British Raj when the East India Company established the “Board of ordnance” at Fort Williams, Calcutta and a factory for producing gunpowder at Ishapore. From their colonial masters OFB’s officials/staff inherited not only British clubs and hospitality but also a colonial mindset. Having tasted blood of staying in palatial bungalows they got used to a sense of high self-esteem. Salaries were high with a generous amount of “Overtime” to foremen and the workers with a perfect example of colonial hangover, making them oblivious of the winds of change blowing and changing hand of clock of time. Having had two back to back tenures spanning 05 years on deputation with the DGQA ( Dte general of quality assurance) the country’s premier quality assurance organization which acts as a “sword of Damocles” over the head of OFB to maintain standards of quality in arms /ammunition as per field army’s requirements I was aghast with the mismatch of the aspirations of the field army which they had from the OFB. A little bit of it later in this write up.

Well if one looks up at the past history of OFB, it was VK Krishna Menon who was made the first minister of defence production having been removed unceremoniously from the august post of Defence minister in the light of his abysmal performance during the 1962 Sino-Indian conflict. Before this, all the ordnance factories used to be under the umbrella of MOD. It is said that it was under VK Krishna Menon that the ammunition factories had started making coffee percolators giving a go by to the security threat to the country thinking all along to make best use of this manpower for business purposes. This status quo of mediocrity built in by decades of unaccountability to the stake holders, an assured process of procurement by the armed forces by raising indents irrespective of the quality, cost and delay further aggravated the system, making it unnecessary to innovate. Complacency crept in and hardly any product met the expectations of the armed forces. Just an example to  buttress the above statement. India’s arm imports fell by a whopping 33% between 2011- 2015 and 2016 -2020, but it still continues in the strategically vulnerable position of being the world’s second largest arm importer just behind Saudi Arabia. India accounted for 9.5% of global arms import during the period 2016-2020 as per the latest data on international arms transfer released by Stockholm international peace research institute (SIPRI) .Interestingly SIPRI attributed the 33% drop in India’s latest arms import primarily due to its complex and lengthy procedure of procurement ,combined with an attempt to reduce its dependence on Russian arms.

So do not be taken in by the impression that the above fall of 33% in imports of arms /ammunition was a direct function of the efficiency of these 41 ordnance factories who jumped in to fill in the gap. In fact it was the other way around. To be fair to the GOI , there have been previous attempts to corporatize the OFB and its demise was on the cards for the last 2 decades but the attempts were stonewalled by all powerful workers union, and other employees federations . The OFB’s inefficiency, lack of accountability, poor work culture, substandard products, wasteful expenditure and corrupt practices which the CAG has been red flagging persistently were simply ignored or kept on the back burner. Given the stated intention of the govt to go for asset monetization and privatization how was the govt to get the OFB out of the red? The immediate fallout of the announcement was the workers federation’s decision to go on strike which was later on withdrawn by them following the violent clashes in the Galwan valley between the IA & the PLA on the  LAC.

The government too agreed to hand holding and launch negotiations with various federations which obviously did not produce the desired results on expected lines. It was quite clear early on that the government of the day had not consulted the other stake holders namely the DGQA/Dte general of quality assurance to put forward their viewpoints in this whole imbroglio. Had the government done so the way forward would have been quite easy. Even otherwise by selected leaks the users i.e the army had let the proverbial cat out of the bag to the press/media to buttress its claim by blaming the OFB for 403 accidents between 2014 to 2020 due to defective arms &ammunition supply to  them resulting in 27 fatalities and loss of more than 960 crores of rupees. It was also claimed that this amount could have financed more than 100 artillery guns. Expectedly the result of the outrage strengthened the case for corporatization. Now started the game of blame game and mudslinging between the OFB and the IA much to the consternation of the country.The OFB in turn turned the heat on the armed forces by claiming that often these accidents were the result of poor maintenance of guns/equipment, faulty firing drills and un-validated design changes in the weapon systems wrought upon them.Nothing can be farther from the truth, since it is the typical pot calling the kettle black.

Since I have  had the opportunity of serving  in the premier organization of DGQA for 5 long years on deputation from the army, firstly at CQA in Pune (think tank of ammunition) and secondly at CPE, Itarsi one of the premier proof firing establishments of the country where all the products of OFB used to come for testing and evaluation, was witness to numerous accidents/defect cases of the arms/ammunition.I can say with all the advantage of hindsight now  that max number of cases occurred due to non-adherence of process manufacturing of these items to include deviation of TOT (Transfer of technology ) procedures , the ordnance factories not  aligning their shop floor modifications as per TOT specifications to meet the production line and going  in for short cuts thereby resulting in manufacture of products which proved short of technical and tactical requirements as enunciated in the GSQR /General service qualitative requirements of the armed forces. To an extent this malaise points towards the quality assurance agency too. Nothing can be more demoralizing for a soldier in operations when having reposed explicit faith in his arm and ammunition the same malfunctions at the moment of reckoning.

As of now the GOI has taken upon itself to divide these 41 ordnance factories into 07 different DPSUs as mentioned earlier in this write up. So what are the changes slated in these 07 DPSUs to make them relevant in today’s Geo-political scenario? Well on the face of it, there is going to be more functional autonomyand an opportunity to delve through more in improved accountability and efficiency. There is going to be a retinue of officialdom to staff these DPSUs. Actually all the officers, who are serving in these 41 ordnance factories should be made to compete with direct recruited engineers and management experts undertaken by the GOI as has been done for some departments in the MOD to give a feeling of fresh air to the IAS lobby who have been ruling the roost in these areas since independence. Till the time a very stiff competition is not given to these officers recruited from the IOFS (Indian ordnance factory services) and IES (Indian engineering services) by way of exposing them to direct recruitment of engineers from the civil walk of life the fear of sheer survival in a cut throat atmosphere will not sink in their minds and will not egg them on to breach their own benchmark of best performance.

The influx of private vendors /sector to take on the onerous responsibility of manufacture of core components of defence sector in their state of the art laboratories /manufacturing units will act as a booster shot to these 07 DPSUs to gird up their loins . We have in front of us private sector manufacturers like Bharat Forge, L&T, who have stepped up the gas to make in India excellent long range artillery guns, for our army breaking the myth of exclusivity of these ordnance factories to do their bidding.  With Modi government going hammer and tongs to adopt self sufficiency of manufacturing sector in the country, the holier than thou attitude of defence sector ought to be breached  and more private sector units to be embraced with a sense of confidence to let them also partake in national defence off course without compromising on the core tenets of efficacy ,quality control /quality assurance of the products thus made. 


(The writer is a retired army officer and regular contributor to RK. He can be reached on: slalotra4729@gmail.com) 






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