Defence Ministry dissolves OFB, tranfers assets to 7 PSUs

The Defence Ministry has dissolved the Ordinance Factory Board (OFB) with effect from October 1 and transferred its assets, employees and management to seven public sector units (PSUs).

As part of the Atmanirbhar Bharat (self-reliant India) package, the Centre had announced on May 16 last year that it would improve autonomy, accountability and efficiency in ordnance supplies by corporatisation of the OFB.

“Government of India has decided to transfer, with effect from October 1, 2021, the management, control, operations and maintenance of these 41 production units and identified non-production units to seven government companies (wholly owned by the Government of India),” the Defence Ministry said in an order on September 28.

The names of the seven defence PSUs (also called DPSUs), as mentioned in the order, are Munition India Limited, Armoured Vehicles Nigam Limited, Advanced Weapons and Equipment India Limited, Troop Comforts Limited, Yantra India Limited, India Optel Limited, and Gliders India Limited.

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Presently, the OFB is a Defence Ministry entity, which supplies critical arms and ammunition to all the armed forces and the paramilitary.

The order also stated that all employees of OFB (of Group A,B and C), belonging to the production units, and also the identified non-production units, shall be transferred ‘en masse’ to the new DPSUs on terms of foreign service, without any deputation allowance, initially for a period of two years from October 1.

“Each of the new DPSUs is required to frame rules and regulations related to service conditions of the absorbed employees,” the order noted.

The order stated that each of the DPSUs should also seek an option for ‘permanent absorption’ from the employees on deemed deputation to that respective DPSU, within a period of two years.

The order also mentioned that the service conditions of the absorbed employees would not be inferior to the existing ones. A committee would be constituted by DDP (Department of Defence Production) for guiding the new DPSUs in this regard so that the absorption package given is attractive.

(With inputs from Agencies)