Corporatization Of Ordnance Factories Is An Utter Failure – Say AIDEF, BPMS And CDRA

The AIDEF, BPMS and CDRA who are the major employees Organizations of Ordnance Factories have made a critical analysis of the outcome of the Corporatization of the 41 Indian Ordnance Factories.

They have categorically stated with lot of inputs that the decision of Corporatization of Ordnance Factories is a total failure, since the purpose with which the Government corporatized the Ordnance Factories that it will improve efficiency, autonomy and accountability have not been achieved and rather the situation has become worse. They have quoted many examples and incidents in their open Letter which they have addressed to the Defence Minister Rajnath Singh and also to the Empowered Group of Ministers including Amit Shah / Home Minister.

They have further alleged that the CMDs are acting as if they are the supreme authority of the DPSUs. Finally they have demanded that Government should reconsider its decision in the interest of national security and should withdraw the same.

www.indianpsu.com accessed a copy of the joint Letter dated 26.11.2022 addressed to Raksha Mantri Rajnath Singh and copy endorsed to the Members of Empowered Group of Ministers. The contents of the same is published here for the benefit of our viewers –

To,
Shri. Rajnath Singhji
Hon’ble Defence Minister
Government of India,
South Block, New Delhi – 110 001.

Subject : Appeal to withdraw the Corporatization of Ordnance Factories

considering its failure in all aspects.

Respected Sir,
We are writing this letter to invite your immediate attention to the state of affairs in the 7 Corporations created by Ministry of Defence with much fanfare last year, before it is too late for the safety and security of the Nation. It is also pertinent to mention that the recognized Federations viz. AIDEF, BPMS and CDRA of the employees of Ordnance Factories have objected to this very idea of MoD during various interaction meetings held with the Hon’ble RM and with the Secretary / Defence, Secretary and Additional Secretary (DP) on numerous occasions, because we had anticipated its dangerous consequences and pitfall on the national security and its exchequer, even though in vain.

The Government of India has created the 41 Ordnance Factories over the years to safeguard the nation from its aggressive neighbors to equip its Armed Forces with proven Arms and Ammunitions and Equipments including Troop Comfort Items. A lot of money from the public exchequer has been spent on creating these facilities and modernizing it every time to keep in tandem with the technological advancement in all types of Defence Equipments making. The technically competent and dedicated manpower who have mastered manufacture of complicated weaponry and sub-systems over the years are also the national asset.

However, it is painful to see that these are now being allowed to be rotten, because of the willful decision of people sitting at Ministry and Armed Forces Headquarters seemed to have decided not to give sufficient workload to the Ordnance Factories and not to extend any support.

The Government stated that Corporatization of Ordnance Factories will improve efficiency, autonomy and accountability. We are not seeing any such improvement after Corporatization rather situation is becoming worse day by day. We are ready to have a discussion in this regard with facts and figures. Instead of concentrating on productive activities concentration is more on non productivity activities like wastage of money in the name of new set up or other activities such as unnecessary manpower transfers and harassment on employees.

It is also pertinent to inform you that at the time of splintering the 41 Ordnance Factories into 7
Corporations, the Factories were achieving a production target upto Rs. 17,000/- Crores. The claim of Ministry of Defence at the time of creating the 7 Corporations was that they will achieve a production value of Rs. 35,000/- Crores in the next 5 years with value addition every year. It is ironic that instead of giving workload to these Corporations to achieve the target, the Government has systematically curtailed the workload to them to ruin it. It is even worse in the case of TCL, where the entire workload of 4 Ordnance Factories have been decided to be given to the private entities by floating tender suitable to certain entities and deliberately barring the TCL Group of Factories even from participating in it.

We are at loss to understand this calamitous attitude of the Ministry of Defence and Government of India, who on the one side take prestige in augmenting the armed forces and its infrastructure and on the other side are allowing the time tested and proven workforce and the most modern infrastructure facilities created in the Ordnance Factories over the years to safeguard the nation and it security to idle and become sick and perish.
Under these circumstances we once again request the Ministry of Defence to immediately withdraw the decision taken to create 7 Corporations, which is proven to be neither in the national interest nor in the interest of the workforce and would certainly lead to huge shortage of Arms, Ammunitions and Equipments for the Armed Forces, who are facing multiple enemies on the border.

The following will give you a clear picture how post Corporatization things have become worse in the Ordnance Factories within one year of Corporatization.

1) Workload has reduced for almost all the Ordnance Factories and no workload for the four Ordnance Factories under TCL from 2023-2024 onwards. With regard to the Factories under the other 6 Corporations (MIL, AVNL, AWEIL, IOL, GIL and YIL) there is an uncertainty about the workload in the coming years and their survival and there is no positive approach from the MoD and Armed Forces in this regard to keep the Infrastructure of these Factories fully utilized.

2) In Ordnance Factories like GCF, Jabalpur despite sufficient workload for the time being, most of the jobs are being outsourced which ultimately compromise the quality of the jobs and delay in completing the target. Rework has to be done by the Ordnance Factory Workers on many of the components purchased from the trade thereby wasting manpower and public money. When plant and machineries and manpower is readily available in the Factories, we fail to understand why the Corporations are resorting to large scale outsourcing which ultimately increases the cost of production as the installed capacity is underutilized.

3) On paper it is shown that workload is available in AVNL, AWEIL etc. But physically there is bottle neck in providing materials and components etc. Acute shortage of manpower due to large scale retirement is not being compensated by fresh recruitments. This affects the production, productivity and target.

4) Assurances given by Hon’ble RM and the Secretary that handholding and all types of support including financial and non financial support to the 41 Ordnance Factories post Corporatization is being blatantly violated.

5) The CMDs of the Corporations feels that they are the supreme Authority of the DPSUs and it is not required for them to have any consultation / discussion with the major stake holder of the Ordnance Factories i.e. the Federations and the CDRA.

6) The Officers who were Architects of creating these non viable Corporations and responsible for all the today’s mess the Ordnance Factories are facing have been comfortably transferred out and there is no attempt by the MoD / DDP to address the post Corporatization problems. No attempt has been made to deal with the uncertainty stalking the employees and the Organization.

7) To further increase the cost of production retired officers are being given reemployment in some of the Ordnance Factory Corporations like MIL etc. Prior to Corporatization of Ordnance Factories the MoD used to blame the Ordnance Factories that the work culture is very poor and bad. If it is so then the Officers who are responsible for the so called bad work culture how they are being reemployed in the Ordnance Factories. This needs investigation.

8) Huge amount of money is being spent for luxurious corporate Office Building in the name of rent, furnishing etc. and also on large number of the so called public interest transfer of Officers, JWMs etc.

9) Claim of profit by these Corporations are hollow and beyond truth. This also needs an independent and CAG Audit to bring the truth.

10) Accidents in the Ordnance Factories have increased within this one year. Regular accidents are taking place especially in the MIL (erstwhile A&E Group of Factories). To mention specific examples, in the Cordite Factory Aruvankadu and Ordnance Factory Khamaria frequent accidents are taking place. In the major explosion which took place on 29.09.2022 in Khamaria has resulted in the death of one worker and serious injury of 5 workers. In the accident happened on 24.11.2022 at Cordite Factory Aruvankadu, 2 DSC Jawans were seriously injured due to explosion, one DSC Jawan lost his three fingers in left hand and severe injury on his body. If required date wise accidents we will submit to your honour.

11) In a nut shell there is total chaos and confusions in all aspects in the 7 Corporations and the purpose for which the Government was justifying Corporatization has not been achieved and it is a failure experiment.

12) No money is spared for training and R&D activities and how skill and knowledge updation and development of new products will take place.

Sir, these are all only few examples. We are confident that neither the CMDs nor the DDP Officials have brought the above ground realities to your notice and it is unfortunate that our Hon’ble RM and EGoM is kept in the dark about all the above post Corporatization developments. You will appreciate that any organization can be built-up only on the motivation of the employees and post Corporatization the morale and motivation of employees have gone down very badly. There is in all pervasive in the employees including Officers that the intention of the Government is not to make this venture successful but to ultimately make the 41 Ordnance Factories sick and sell this to the crony capitalists in the near future and this is the reason for apathy of the Government in dealing with the concerns of the employees.

In conclusion the Corporatization of Ordnance Factories is a total failure and no systematic improvement worth its name has taken place post Corporatization. The changes whatever the Government and the Corporations are painting out are cosmetic and on the surface only.

We once again submit to your honour to consider and implement the Alternative Proposals and Robust Proposals given by us to the DDP to achieve Rs. 35,000 crores production target / turn over by the 41 Ordnance Factories within next 5 years in the Government setup itself. We assure our full support and cooperation for implementing the above proposals given by us.

As regards the issues and problems being faced by the dedicated and committed workforce of the Ordnance Factories we are submitting a separate Letter to your honour which will further give you a clear picture how the Corporatization exercise is a failure one.

In view of all the factual position we on behalf of the 76 thousand Defence Civilian Employees of Ordnance Factories fervently appeal to your honour to reconsider the decision of Corporatization and to withdraw the same and restore the status of the 41 Ordnance Factories as a Government Organization in the interest of the Defence preparedness and national security of our country.

A delegation of AIDEF, BPMS and CDRA would like to meet you in person to submit our considered views in this regard before your honour.

Sir, Awaiting for your earlier and favourable action please.

Thanking you,

Yours Sincerely,

(C. SRIKUMAR) General Secretary/AIDEF

(MUKESH SINGH) General Secretary/BPMS

(AJAY)Gen.Secretary /CDRA

Copy to :
The Hon’ble Members of Empowered Group of Ministers