Govt Shuts Down This Critical PSU; Employees, Assets Shifted To Other PSUs

Govt Shuts Down This Critical PSU; Employees, Assets Shifted To Other PSUs
Govt Shuts Down This Critical PSU; Employees, Assets Shifted To Other PSUs

As per an official order, the Defense ministry has dissolved the Ordnance Factory Board (OFB) with effect from October 1 and its assets, employees and management will be transferred to seven public sector units (PSUs).

Government’s Decision To Transfer Control

Prior to this, on May 16 last year, the central government had announced its plan to improve autonomy, accountability and efficiency in ordnance supplies by corporatisation of the OFB as part of the “Atmanirbhar Bharat” (self-reliant India) package.

Afterworld, the defense ministry issued an order on September 28 saying that the Indian Government has decided to transfer 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) with effect from October 1, 2021.

Seven Defense PSUs

These seven defence PSUs (also called DPSUs) are Armoured Vehicles Nigam Limited, Munition India Limited,Troop Comforts Limited,  Advanced Weapons and Equipment India Limited, Yantra India Limited, India Optel Limited and Gliders India Limited.

Presently, the OFB is a defence ministry entity and it assists in supplying critical arms and ammunition to the three armed forces and the paramilitary.

What About Employees?

According To the order, the government has decided that all the employees of OFB (Group A, B & 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 (deemed deputation) initially for a period of two years from the appointed date (October 1).

The order also noted that each of the new DPSUs is required to frame rules and regulations related to service conditions of the absorbed employees.

Order further mentions 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 stated that the service conditions of the absorbed employees would not be inferior to the existing ones. 

In this regard, a committee would be constituted by DDP (Department of Defence Production) for guiding the new DPSUs.

So that the absorption package given is attractive, as mentioned in the order.

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