The Defence Ministry has dissolved the Ordnance Factory Board (OFB) with effect from October 1 and transferred its assets, employees and management to seven public sector undertakings (PSUs), according to an official order. 

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

In an order dated September 28, the Defence Ministry said: “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).” 

According to the order, the name of the seven defence PSUs (also called DPSUs) 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. 

The OFB is currently a Defence Ministry entity and supplies critical arms and ammunition to the three armed forces and the paramilitary forces. 

The order added: “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).” 

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