ABSTRACT
The modern defence industrial complex in India owes its origins to the Gun and Shell factory set up by the East India Company at Cossipore in 1801. In 1962, the Department of Defence Production was created with the objective of ‘developing a comprehensive production infrastructure for the defence of the nation’. 1 From these humble beginnings India’s state-owned aerospace and defence (A&D) industrial base includes forty-one factories of the Ordnance Factory Board (OFB) and nine Defence Public Sector Understandings (DPSUs) with forty-five production units. These state-owned enterprises (SoEs) manufacture a range of products for the armed forces. With approximately 1.59 lakhs employees the SoEs had a total value of production of INR 45,582.3 crores in 2014-15 (See Table 9.1). 2 A substantial amount of the vendor base is drawn from the Micro, Small and Medium Enterprises (MSMEs) for indigenous supplies and foreign Original Equipment Manufacturers (OEMs) are sourced for products that are not available from Indian sources.
