DRDO, Ordnance Factories & India’s Defence Industrial Base

“Pakistan probably has a better industrial base, as far as defence production is concerned, than our country. In fact, they export defence equipment abroad, definitely more than what we are doing.


DRDO, Ordnance Factories & India’s Defence Industrial Base

BACKGROUND

Lt. Gen. Sarath Chand, Vice Chief of Army Staff  (VCOAS) when speaking at the inaugural session of AMICON 2017, a two-day conference organised by the Army and the CII, said that Pakistan has a better military industrial base and exports more defence equipment than India, and came down heavily on ordnance factories which manufacture weapons for the forces. He also said that, “The ordnance factories have not been able to keep pace with changing technology while there is no competition whatsoever which is an unsuccessful method of supporting our defence requirements.”

He stated, “Pakistan probably has a better industrial base, as far as defence production is concerned, than our country. In fact, they export defence equipment abroad, definitely more than what we are doing…There is little or no research and development. They do not even have the capability of absorbing the industry through transfer of technology, and in some cases they have even failed to assemble products that have been imported from abroad.”

Stressing on the need for indigenous defence manufacturing capability, he talked about the ‘Make in India’ programme, the Defence Procurement Policy 2016, the Strategic Partnership model, and the creation of the Army Design Bureau (ADB) as the major steps in that direction.

RESPONSES

Lt Gen Harbahjan Singh (Retd), ex- Corps of Signals

Our DRDO is a legacy of the British Raj. India had very little R&D base for military systems when Krishna Menon, the maverick defence minister, made great efforts to set up military systems manufacturing infrastructure like Bharat Electronics and various laboratories, ably executed by then Brig BD Kapur (later Maj Gen), the CCR&D, an outstanding Corps of Signals Officer. One of the scientists Kapur recruited was no other than Abdul Kalam.

DRDO has also produced some world famous entrepreneurs like Mr. Kapani, who is called the father of Fiber Optics and has a thriving company in California. So what ails the DRDO?

Government (IAS) Control: Scientists cannot be recruited, paid, promoted on similar lines a Babu. They must have a greater autonomy. Wherever IAS control is absent like in space and nuclear departments, Indian scientists have delivered. As far as Ordnance Factories are concerned, they are an archaic set up. Indian private manufacturing base has grown many fold and the armed forces should procure from them. The labour laws enshrined in Ordnance Factories should be changed, so that the management is not held hostage by them.

Ordnance factories should be whittled down and stop manufacturing non warlike stores. Even for war like equipment, private sector should be exploited. Our manufacturing base should be gradually shifted towards the East; East of Siliguri and also northwards where bulk of the Army is deployed.

Maj Gen Anil Sengar (Retd), ex-Mech Inf

Ordnance factories work well below their capacity but claim huge overtime. What an irony? Secretary Defence Production is the boss of Ordnance Factory Board (OFB). He has to show some progress so the inefficient system continues. Sadly, what OFB produce is costlier than what we import. Small increment in capacity becomes a project worth thousands of crores. Without a full time Defence Minister and changing them when they start understanding the system gives no future for own Defence Industry.

Brig LC Patnaik (Retd), ex-Infantry

All of us are aware that the majority of the forty six ordnance factories were established to support the war effort of 2nd world war and post 62 debacle. These factories were apparently raised with a industrial concept of British and Russian models, which are vastly different from the present era. No effort was made to modernize them; as it “suited” our policy makers, top military officials and the bureaucracy to enable them to make huge imports of defence hardware. Pakistan changed its export policy for defence equipment in the late 70s and established a series of modern ordnance factories with the help of US, Turkey and few East European countries.

The models were followed by few other countries like Iran, Indonesia, Malaysia and Singapore. India has ventured into a policy shift only recently. Given the market dynamics and our strategic partnership with US and Japan, our ordnance factories can be fully overhauled to produce export worthy defence equipment. The newly created Army Design Bureau must actively collaborate with the industries and the premiere technical Institutes in the country and abroad to produce prototypes; and then hand it over to the OFB for manufacture. For this there is a need to break the “mafia” presently in the system with strong political overtones. The pressure from the military top brass is very essential.  The VCOAS/DCOAS (P&S) need to enunciate policy changes through constant interaction with the government, DRDO and the industries.

Gp Capt Johnson Chacko (Retd), ex-IAF

There was a time when DRDO and ordinance factories were needed. We also needed HMT to make watches. The hand wound ones are still revered by the Chinese soldiers at Nathu La. That time has passed as investment from private sector is no more a limit especially from the likes of Tatas and Reliance. If Tata can own Jaguar Land Rover Company in the UK, they can definitely make vehicles for the armed forces. Government should not be in the business of Ordnance Factories.

Public sector is dependent on the government for orders without which they collapse. They don’t have a marketing and sales team worth the name. So they can’t sell their products or generate orders for manufacture. Their objective is employment, not profits. Unless that changes, quality is not going to improve. The government should move out of this business. A successful transition was done by Tata’s Titan, when quality engineers from HMT were absorbed, leading to dismantling of HMT’s watch division.

DRDO is supposed to do research and development in the defence domain. An audit will reveal as to how effective they have been. They have built a lot of labs at the expense of the exchequer and these labs should be made available to civil enterprises to develop systems for the armed forces without infringing on their IPR. The government can provide funding for R&D to private companies and the products that win the contract can be inducted into the Armed Forces and those that don’t win the contract can also be sold to other countries at a lower cost. The spin off from the research can be used for developing products for civil use. (HAL has made bus bodies for BMTC). The output of DRDO does not appear to be commensurate with the investment made in it and satisfaction level of the armed forces.

Col Ashok Jamwal (Retd), ex-Infantry

Many years ago, sometime in 1992/94, I was at a DRDO Lab in Hyderabad, with a couple of senior folks, including the director. After some time, the discussion turned to, as used to happen with me quite often, the inability of DRDO to meet the timelines for the equipment. In their defence, one of the arguments put forward was that the DRDO does not get the best scientists, just like the military does not get the best Officers, due to inadequate pay and perks.

It was explained that most of the recruits to DRDO came from third class engineering colleges and not from IITs. Those few who came from second rung institutions due to their constraints, soon left after embellishing their CVs with experience on cutting edge equipment and technologies. I could not restrain from remarking that since the problem was so clearly outlined, it was clear that persons who rose to top positions were also third rate and therefore it was quite likely that the few good men who joined DRDO could not work with third rates. We all had a good laugh but that was the end of my social interactions with DRDO brass for all times to come.

Cdr Mukund Yeolekar (Retd), ex-Indian Navy

DRDO undertakes R&D based on SQRs formulated by the Service HQs/Ops Directorates. The SQRs are based on perceived threats and technological developments by countries in the neighborhood. Considering present parameters and extrapolating for future improvements in a weapon system, the Ops Dte may tweak the SQRs in order to develop a state-of-the art system over a reasonable period of time. However the DRDO cannot guarantee the PDC of a project. Several constraints and hurdles faced by DRDO add to the delays and cause dissatisfaction in the user.
 
Constraints could be lack of material specifications, lack of indigenous know-how for manufacture and quality control, fear of the unknown, unwillingness to take calculated risks, low priority for trials due to other operational commitments etc. These factors may entail deputing scientists to foreign countries for learning the technology and processes. Even after learning from foreign counties we cannot be assured that Transfer of Technology (ToT) and know-why is 100% complete. The answer lies in absorbing and learning the technology by our scientists even if the foreign agency withholds some critical information.

Ops Dte would want a matching weapon/sensor to that of the enemy’s at the earliest opportunity in order to counter him in an adverse scenario. This cannot be questioned for obvious reasons. They may recommend import of the weapon for operational reasons, fearing a long lead time for indigenous development, trials, modifications, integration, acceptance and mass production.

It is well known that most of our brilliant IIT graduates go overseas for lucrative careers and for being in a conducive technical environment with the latest facilities. They see no scope for themselves in indigenous enterprises and organisations like DRDO or PSUs.  Therefore DRDO has to be content with 'mid-level' technical experts who nevertheless have put in consistent efforts for several years and produced tangible results. Their joint efforts with some private enterprises and PSUs have fructified in the form of certain sophisticated weapon/sensor/EW systems.

Some examples of equipment for Navy are Varunastra torpedo, Advanced Hull mounted sonar, LRSAM and Mareech Underwater decoy. Therefore comments of VCOAS that there is no R&D is incorrect. Some private companies like L&T, Tata Power, Bharat Forge, Mahindra etc have made significant progress in indigenous developments for defence. These should be noted and private entrepreneurs be encouraged. OFB units all over the country need to be revamped in all aspects such as trained manpower, infrastructure and competitive business policy aimed at exports. Then they will come at par with leading PSUs.

Conclusion

  • We need to give serious thought to participation by private enterprises in defence R&D so that there is competition to DRDO.
  • Certain critical areas of R&D in weapons and sensors need a fillip by way of domain experts since we are presently lagging here. Even friendly countries will not share technology in these areas.
  • There is a need to attract better talent for long term R&D.
    If nation's security is at stake imports have to be given priority  when R&D is delayed or indigenous product is not qualitatively up to the mark.

Air Cmde SN Bal (Retd), ex-IAF

It is not possible to comment on the VOAS’s remark about Pakistan’s industrial–military base being better than ours or not. Perhaps he has some inside information that is not in the public domain – and which he has so thoughtfully shared with the CII. In any case, Pakistan’s performance should not be the focus of debate. The VCOAS is also silent on the performance of the DG Ordnance Factories. What the VCOAS has said may or may not reflect reality in toto but his remarks do not indicate the way forward.

My modest experience with DRDO has been rather positive. With effective liaison, parachutes were successfully reverse-engineered within three months at a moderate cost of just over a lakh of per parachute – while British Aerospace wanted around GBP 15,000 (Great Britain Pond Sterling) with three years to do the job! The message is crystal clear: bring about time-bound accountability, and effective management.

While my experience has been at micro-level, there is no reason to believe that it cannot be replicated at macro-level; given the will of course. There is no point lamenting about our scientists being third-rate. The rot probably goes right to the very top of the pyramid. Accountability and punishment have to be brought about from within the system. This is indeed possible. The mantra should be that those in position should either hit out or get out.

Gp Capt TP Srivastava, ex-IAF

Before commenting on DRDO and Ordnance Factories performance (or rather non-performance), I will take the liberty of including HAL as well. These premier organizations have, without any doubt, have either not performed or performed well below the desired levels over past five decades. Apportioning blame will get us nowhere. Prudence demands that in order to rectify the gross mismanagement/inefficiency in these organizations, we introduce immediate measures. Some of them might be radical, so that they deliver something in the next twenty odd years.

It does not require any brilliance to merely shout on top of our voices and seek closure of these institutions. It is also irrational and irrelevant to place entire blame on these organizations. Military has to look inwards.

Firstly, the military must take up jointly with the government that at least 0.5% of GDP must be devoted towards R&D. We in the military have been over critical of DRDO with reference to  budgetary allocation towards R&D. Current DRDO budgeting is out of overall defence budget. That needs immediate change from next fiscal. We must remember that every project undertaken does not fructify. Only a small fraction, may be 5-10% of experiments, lead towards operationally capable weapons platforms. It would be in the larger interest of the military to exercise such option.

Secondly, military (read each Service HQ) must arrive and freeze QRs for planned weapon platforms at least five years before the development process begins. No modifications/alterations/additions must be made during development phase of the first prototype. Gestation period for all ‘big ticket’ platforms is at least a decade.

Thirdly, under ‘Make in India’ initiative, the military must identify specific platforms that can be manufactured (not assembled) in India under license. If we can swing the F-16 deal with USA, it would bridge the yawning gap in our strike capability in about 15 years from the day we start manufacture in India.

Fourthly, the military must impress upon DRDO to develop weapons for the platforms already in service. Currently we do not manufacture any PGMs and other stores. If we were to do an honest audit of our weapons holdings as on date, we will find that we are well short of WWR. We will have the platforms but run out of ammunition within a fortnight or less in case of an intense conflict.

Fifthly, one of the most abhorring restrictions of issuance of NOC by DRDO imposed on the military with reference to acquisition of new platform must be removed. I understand it has already been done. Sixthly, Defence Procurement Procedure must be re-written specifying accountability/responsibility for time and cost over runs. Lastly, ‘blame game’ must stop.

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