Army Forced to Cut Down its Supplies Up to 50 Percent From Ordnance Factories

Indian Army has decided to drastically cut down its supplies up to 50 percent from the state-owned ordnance companies. This move comes as a burden to the army personnel, including the soldiers, who are now required to spend their own money to buy basic work-time necessities such as clothing (combat dress, berets, belts, shoes) from civilian markets.

“Ninety-four percent of products of ordnance factories are supplied to the Army. We have decided to bring this down to 50%. So from Rs 11,000 crore given to the ordnance factories, it was brought down to around Rs 8,000 crore,” an army official was quoted as saying by The Economic Times.

Since October 2017, three major defence employees' unions – the All India Defence Employees Federation (AIDEF), Indian National Defence Workers Federation (INDWF) and the Bharatiya Pratiraksha Mazdoor Sangh (BPMS), have been waging a series of struggles against the privatization in the Defence sector and the government autocratic decisions weakening the defence industry.

Meanwhile, on June 4, Nirmala Sitaraman, Minister of Defence, held a meeting with the representatives of AIDEF and gave assurance that she will direct the authorities to deal with the issues represented by the federation.

Speaking to Newsclick, C Srikumar, general secretary of AIDEF said: “In the emergency meeting called by the minister, we submitted memorandums putting forward the serious concerns of the employees. we will be continuing with our struggles until the defence industry is strengthened and the employees' welfare is taken care of by the government.”

The longstanding demands of these employees' unions include – not to encourage private sector at the cost of ordnance factories, rollback the wage cut imposition on the employees of ordnance factories, to constitute a committee at the Ministry of Defence level with union members representatives and the revival of the defence sector. The unions are even considering to go for an indefinite strike if their demands are not fulfilled.

Furthermore, Srikumar opined that the Army and central government are choosing the private and foreign companies for the manufacturing of high-tech calibre weapons instead of giving the task to the state-owned ordnance factories.

As the central government failed to provide additional funds to the army which is said to be working on three major projects to build its stock which requires emergency procurements of ammunition and spares worth thousands of crores, the army has been forced to “dig into its own minimal budget” to cater to these requirements, told an official dealing with the matter to The Economic Times. The three projects are – emergency procurement, 10(I) order and Make in India. Reportedly, the army has estimated that the project 10(I) or 10 days of intense war order, would cost about Rs 21,739.83 crore.  

Earlier this month, reportedly, the army has finalized Rs 17000 crore Make in India project over a period of 10 years (costing Rs 1700 crore per year) with eleven Indian firms under which a range of ‘indigenous’ ammunition for its critical weapons will be produced. Alongside, the Army is also procuring Pinaka rockets over 10 years, which costs Rs 1000 crore per year.

While the central government had earlier specified that under the Make in India project, the ammunition to be manufactured includes 30mm used by the infantry, 120mm extended range, 23mm and 40mm grenades.

After NDA-led government came to power in 2014, privatization and weakening of public sector units, including defence industry, has become the foremost policy of the regime. The Ministry of Defence and the Department of Defence Production (DDP) had earlier taken a decision to give licenses to 222 private companies for defence manufacturing, and to ease the license policy with 100% FDI being allowed for products, including those being manufactured by Ordnance Factories. As a result, the functioning of Defence industry, including the 41 Ordnance Factories, Army Base Workshops under Corps of Electronics and Mechanical Engineers (EME), Depots under Ordnance Services Directorate and Military Farms are being weakened.