piKacHHu
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- Sep 5, 2015
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Lack of accountability happens when you have captive markets; OFB knows whatever crap they produce, the armed force will going to procure it as there is no alternate vendor available.Fuck Capitalism and socialism.
Accountability is where its at.
Indian Companies, its owners, government and Public should all act as a large family. When one falls down the other pulls them up.
Second, HAL, OFB or any other DPSU for that matter, they don't include the cost of human resources in the project cost; So, excluding man-hour cost amounts to state subsidy for the production which for any private player is not an option. This covers up the lack of efficiency in DPSUs where the long delay in projects doesn't reflect huge cost overruns as it is assumed that the Government is taking care of the salary-perks of the PSU/OFB employees.
Third, Lack of economy of scale is also the reason which deters private sector investing heavily into defense production. Look at the L&T plant set-up for K9 Vajra, they are literally begging for more orders as their production line is about to meet its target before its stipulated deadline. Similar is the case for M777 assembly at Mahindra motors. In absence of large order, who will invest in production line which gets idle after catering a few orders.
In the prevailing scenario, you can't make rivet nut to jet engines under single roof as it's quite uneconomical. Diversification hedges the potential risks and reduces production cost; that is why every aviation giant from LM to Airbus, they promote an ecosystem of niche MSMEs which contribute heavily in their manufacturing.
For HAL, it's for their own interest to improve efficiency in production for lowering the production cost; otherwise in a case where it decides to participate in any global tender for exporting Tejas, they will get royally exposed while justifying unit cost that too including man-hour cost. That will simply break the myth of cheap production cost in India. (Something, which we had seen during MRCA 1.0 for Rafale production line at HAL.)