Seven new defense public sector pledges, cut from the former Ordnance Factory Board (OFB), were set aside on Friday by Prime Minister Narendra Modi for the nation as part of a major reform initiative to boost India’s defense production.

Defense Minister Rajnath Singh said the government would initially provide support to businesses through financial and non-financial interventions if needed.

The Defense Ministry said the companies began operating on October 1.

The launch event of new companies was organized on the day the state celebrated ‘Vijayadashammy’.

The Federal Cabinet on June 16 approved a long-awaited proposal to restructure the 200-year-old Ordnance Factory Board that operates 41 facilities for the production of ammunition and military equipment into seven state-owned entities to improve accountability, efficiency, and competitiveness.

OFB was dissolved on October 1 and its assets, employees and management were transferred to the seven companies.

In his speech, Modi said that the seven new companies would constitute a strong base for the country’s military power in the times ahead.

The seven new defense companies are Munitions India Limited (MIL), Armored Vehicles Nigam Limited (AVANI), Advanced Weapons and Equipment India Limited (AWE India), Troop Comforts Limited (TCL), Yantra India Limited (YIL) and India Optel Limited (IOL). ) and Gliders India Limited (GIL).

In his video address, Modi referred to the auspicious occasion of “Vijayadashami” and the tradition of worshiping weapons and ammunition on that day.

“He said, in India, we see force as a means of creation. He noted that in the same spirit, the nation is moving towards strength,” a government statement said.

Defense Minister Singh described the decision to transform the Air Defense Bureau into seven defense companies as “historic” and said the move reflected the government’s determination to achieve self-reliance in defense production.

Noting that the new firms will have full potential for growth, Singh said, if necessary, the government will initially provide support through financial and non-financial interventions.

He said the reform procedure would provide autonomy for these companies and improve accountability and efficiency.

“The objective of this restructuring is to transform munitions factories into productive and profitable assets, improve expertise in product range, increase competitiveness, improve quality, enhance cost efficiency, and ensure self-reliance in defense readiness,” he said.

Singh had hoped that in the times to come, these new companies would not only play an important role in the defense manufacturing ecosystem but would also be growth engines for the Indian economy.

He added that restructuring is a continuous process and not an end in itself.

The Minister of Defense stated that all former OFB employees (Group A, B and C) belonging to production units will be transferred to legal entities on the basis of dispatch for a period of two years without any change in their terms of service as central government employees.

“The country’s defense sector has achieved greater heights due to the reforms taken by the government in the past few years. We have created a favorable environment for exports and foreign direct investment,” he said.

Singh added that the Ministry of Defense has set a target of achieving a turnover of Rs 1.75 crore in air and defense goods and services by 2024, including exports of Rs 35,000 crore.

Jayant Patel, President of the Indian Defense Manufacturers Association (SIDN) welcomed the establishment of the seven companies.

“Our country’s defense industry aspires to become a global brand. As envisioned by the Prime Minister, the industry can leverage mutual strengths to enhance India’s competitiveness with world-class quality and reliability backed by research, development and innovation to be a force to be reckoned with on the global stage.”

(The title and image for this report may have been reworked only by the Business Standard team; the rest of the content is automatically generated from a shared feed.)

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