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Ordnance Factory Board: Corporatisation and the 7 Defence PSUs

In 2021, India dissolved a 42-year-old defence organisation overnight. It took five more years to fully settle what happened to its 65,000 employees.

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1712: India’s first ordnance factory, a gunpowder factory at Ichhapur, is established by the Dutch Ostend Company.
1801-1802: The Gun Carriage Agency at Cossipore is established, with production starting on 18 March 1802.
1979: The Ordnance Factory Board (OFB) is formally constituted, on 2 April.
2020: The government announces plans to corporatise OFB, on 16 May, under the Atmanirbhar Bharat push.
2021: OFB is dissolved on 1 October, and its 41 units transfer to 7 new Defence PSUs.
2026: On 5 July, the government confirms nearly 65,000 erstwhile OF employees have been redeployed into Regular Government Service.

The Ordnance Factory Board (OFB) was dissolved on 1 October 2021, and corporatised into 7 new Defence Public Sector Undertakings (PSUs).
The 7 PSUs 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.
Corporatisation transferred the management, control, and operations of 41 production units to these 7 companies.
It was part of the Atmanirbhar Bharat (self-reliant India) push, announced on 16 May 2020. The goal was greater autonomy, accountability, and efficiency in defence production.
OFB itself, as a formal organisation, was constituted on 2 April 1979. Ordnance-factory production in India dates back much further, to 1712.

Each PSU specialises: Munitions India handles ammunition and explosives. Armoured Vehicles Nigam makes tanks and armoured vehicles.
Advanced Weapons and Equipment India covers weapons and combat equipment. Troop Comforts supplies clothing and general stores for troops.
Yantra India makes vehicles and equipment. India Optel handles optical and electronic devices, and Gliders India makes parachutes and allied items.
At corporatisation, employees were placed on deemed deputation, not permanently transferred. This addressed a major employee-union concern at the time.
A 19-member Bharatiya Mazdoor Sangh (BMS) delegation met Minister of State Dr. Jitendra Singh in 2026, reflecting continued employee-welfare engagement, years after corporatisation.

On 5 July 2026, Dr. Jitendra Singh confirmed nearly 65,000 erstwhile OF employees had been redeployed into Regular Government Service.
This resolved one of corporatisation’s biggest concerns: long-term job security for staff who never chose to leave government service.
As a member of an Empowered Group of Ministers (EGoM), Singh had earlier backed extending deemed deputation until retirement. This 2026 redeployment went further, making that security permanent.
The gap between the two dates is telling. Corporatisation happened in 2021, but its human consequences took five more years to fully settle.
This mirrors a pattern seen elsewhere in India’s institutional reforms. Structural change often arrives years before its full implementation catches up.