New Defence Public Sector Undertakings (DPSU) launched

New Defence Public Sector Undertakings (DPSU) launched

Part of: Prelims and GS II – Defence and security

Context Indian Prime Minister recently launched seven new Defence Public Sector Undertakings (DPSU), incorporated after the dissolution of the Ordnance Factory Board (OFB).

• Under the initiative of Atmanirbhar Bharat, the goal is to make India a military power globally on its own strength and also develop a modern indigenous defence industry.

Key takeaways 

• The Ministry of Defence (MoD) has converted all pending orders with the 41 factories of the OFB into deemed contracts worth over Rs. 65,000 crore for the new companies. 
• The over 70,000 employees of the OFB (Group A, B & C) units have been transferred to the new DPSUs on terms of foreign service without any deputation allowance initially for a period of two years.
• The new structure will help overcome various shortcomings in the existing system of OFB and encourage companies to become competitive and explore new opportunities in the market including exports.
• The seven new companies are Munitions 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.