Cabinet approval for OFB corporatisation
- June 17, 2021
- Posted by: OptimizeIAS Team
- Category: DPN Topics
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Cabinet approval for OFB corporatisation
Subject : National organisations
Context : Addressing a long pending reform, the Union Cabinet on Wednesday approved a plan to corporatise the Ordnance Factory Board (OFB), which has 41 factories, into seven fully government owned corporate entities on the lines of Defence Public Sector Undertakings (DPSU).
Concept :
- Once implemented, the OFB, the establishment of which was accepted by the British in 1775, will cease to exist.
- This restructuring is aimed at transforming the ordnance factories into productive and profitable assets, deepening specialisation in the product range, enhancing competitiveness, improving quality and achieving cost efficiency.
- Corporatization refers to the restructuring or transformation of a state-owned asset or organization into a corporation. These organizations typically have a board of directors, management, and shareholders.
Ordinance Factory Board:
- It is an umbrella body for the ordnance factories and related institutions, and is currently a subordinate office of the Ministry of Defence (MoD).
- The first Indian ordnance factory was set up in the year 1712 by the Dutch Company as a GunPowder Factory, West Bengal.
- It is a conglomerate of 41 factories, 9 training Institutes, 3 regional marketing centres and 5 regional controllers of safety.
- Headquarters: Kolkata
- Significance: A major chunk of the weapon, ammunition and supplies for not just armed forces but also paramilitary and p744olice forces comes from the OFB-run factories.
- Production includes: Civilian and military-grade arms and ammunition, explosives, propellants and chemicals for missile systems, military vehicles, armoured vehicles, optical devices, parachutes, support equipment, troop clothing and general store items.