RAKSHA ANIRVEDA
IN FOCUS there is a Service representation through Principal Staff Officer level official at the OFB Board level, there is minimum direct interface between the User (Line Dte in the Services HQ) and the OFs through the product development or manufacturing stages. (v) ‘Protected’ employment guarantee of a government job: OFB employees enjoy the ‘safe and secure’ status of being government employees. They are unwilling to transit to an environment of ‘competitive production’. (Reports of protest by employees post the announcement to corporatisation the OFB, and efforts to assuage them are self-speaking).
EXPECTED FRUITS OF OFB CORPORATISATION
Indian Army’s MBT Arjun in action
(i) Advantage of Monopoly. OFB’s advantage of being a monopolist supplier has resulted in minimal innovation and technology development leading to resulting in low productivity as evidenced in the low value of Issue (VOI). Zero penalty for delayed delivery and lack of a structured, dynamic feedback mechanism have only added to the Services’ frustration and woes. VOI for the past five years is as below:
(ii) Poor quality of weapons: Most quoted instances being the INSAS Rifle and cases of qualitative deficiencies in ammunition. (iii) High cost of products: OFs being monopolistic suppliers, ipso facto, the pricing of their products is not based on market dynamics. A high proportion of budgetary allocations to OFs go towards salaries and wages to their approximately 85,000 employees. (iv) Lack of user interface: While
Year
Target (in Rs crores)
Value of Issue (in Rs crores)
% Achievement
2014-15 RE
12120
11391
94%
2015–16 RE
13552
13111
96.7%
2016–17 RE
15393
14825
96.3%
2017–18 RE
14115
14127
100.1%
2018–19 MA
13249
12801
96.6%
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Developing a Viable Ecosystem: As ‘Systems Integrators’, OFs directly manufacture critical components / sub-assemblies, sourcing non-critical items from private vendors through annual or ‘as required’ competitive bidding. The uncertainty of assured supply orders leaves little incentive for vendors to invest into product development and quality enhancement. OFB would now be enabled to draw up long term supply arrangements with vendors thereby creating an ecosystem primitive to efficiency and high quality. Joint Ventures with Private Sector: OFB would be enabled, where required, to associate private industry into the production process exposing OF personnel to imbibe best practices of private sector performance. Fiscal Autonomy: OFB would be unencumbered from limitations of budget allocations and can
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