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SOURCE: MONEY CONTROL

The government is fast-tracking corporatisation of Ordnance Factory Board (OFB). The Cabinet Committee on Security (CCS) has approved the proposal, but given the sensitivity of the issue the government did not announced it officially yet, a source said.

A group of ministers headed by Defence Minister Rajnath Singh is looking after the process of corporatisation of OFB. Two consultancy firms — KPMG Advisory Services and Khaitan & Co — are assisting the government in this process.

Finance Minister Nirmla Sitharaman announced the corporatisation of OFB in May. In the recently held CCS meeting, the government had approved the conversion of OFB into one or more than one corporate entities.

Through corporatisation of OFB, the Centre will focus on adoption of new technology, private investment and efficient governance. This will help to curb import of defence items.

Apart from corporatisation of OFB, the Department of Defence Production is soon going to release a second list of negative items to curb import of defence equipment, the source added.

The government is said to be planning to add around 1,250 items to the negative list. Several round of discussions were held between public sector entities and private players operating in the defence arena. Views of the Indian Army, Indian Air Force, Indian Navy, and Defence Research and Development Organisation (DRDO) were sought on the items that will be included in the next negative list.Earlier in August, the government had issue its first negative list of 101 items. It is estimated that contracts worth almost Rs 4 lakh crore will be placed with the domestic industry within the next five to seven years.