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Army to create Rs.9,000-crore investment opportunities

Army to use GOCO for procurement and maintenance



Indian army will create Rs.8,000-Rs.9,000 crore of investment opportunities for private sector through the Government owned, contractor operator (GOCO) system, Lt Gen R R Nimbhorkar, Master General of Ordnance (MGO), said on 13 Nov 2017.

He said the Army is planning to operationalise GOCO for the procurement and maintenance of equipment.

“This will create investment opportunities of Rs 8000-9000 crores for private players,” said Lt Gen Nimbhorkar.

He was speaking at the 2nd edition of a seminar “OFB-Industry Partnership for Vendor Development and Outsourcing by OFs” organised by the Ordnance Factory Board (OFB) in association with Confederation of Indian Industry (CII) on 13-14 November 2017 in New Delhi.

78% of MGO’s budget goes to Ordnance Factories and it is imperative for Indian industry to partner with OFB, added the General.

India is one of the largest importers of defence goods in the world, and OFB aims for self-reliance under Make in India. General Nimbhorkar also urged Indian industry to move towards BIS standards.

Shri S C Bajpai, Director General, Ordnance Factory and Chairman, Ordnance Factory Board, noted that emerging technologies pose challenges.

He stressed that public private partnerships is an imperative.

The DGOF hinted that the new procurement manual may emphasize on quality and import substitution, and requirement for L1 or lowest tender cost may shift.

The new manual will focus on scale of orders and the continuity.

Baba N Kalyani, Chairman, CII National Committee on Defence & CMD, Bharat Forge Ltd, highlighted that high stress has been laid on indigenisation of defence products.

He added that industry is looking at a better alternative to L1 and urged OFB to work out a mechanism for the same.

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