The Hindu Business Line : Kerala to lobby with Centre for Keltron, Keltec takeover

THE State Government will move the Centre to take over the various units of the Kerala State Electronics Development Corporation (Keltron) as also the Kerala Hitech Industries Ltd. (Keltec) and bring them under the Ministry of Defence.

The State Government had, some time ago, made a similar request to the Centre. Consequently, the previous Union Government had constituted a task force to identify the possible areas of long-term arrangement between the Ordnance Factory Board (OFB) and Keltron and Keltec.

The task force visited the various units of Keltron and the Keltec facility and submitted a report citing synergy between OFB and the two companies. But, the Centre did not take any follow-up action.

The State Government has in recent times written to the Centre on the matter, but to no avail. At a meeting with the Members of Parliament from the State last week, the Government has urged them to take up the issue again with the Centre.

In the case of Keltron, it has been pointed out that the company has undertaken many developmental projects for defence establishments for the last two decades.

The projects/products undertaken for development and production include processor-based ground mines, steering gear control system for naval ships, echo sounder, underwater telephone, access control systems, echo injector procedure teacher transducer and modular interface ship-borne system for the Indian Navy.

As for the Army, the company has developed various items for battle tanks like Vijayantha, T-72 and Arjun as import substitution. Besides, it has supplied UPS and a host of electronics and IT-related products to the various establishments of the Forces.

As of now, Keltron has orders worth Rs 25 crore. It, however, has the strength to execute orders of a minimum Rs 100 crore per annum and the company has submitted offers worth Rs 60 crore with various defence establishments.

The State Government has noted that the investment of the Centre in the defence sector in Kerala is meagre. Though there are 39 factories under OFB and 30 production units in eight public sector undertakings under the Ministry of Defence, Kerala does not have a single such facility. The takeover of Keltron will enable OFB to indigenise the defence requirements in the electronics and IT field.

As for Keltec, the Government has made a case saying that the company was established to specifically cater to the hi-tech hardware needs of the Defence and Space departments. It has now multi-disciplinary capabilities under one roof.

Although the company had achieved commendable progress in developing in-house technology, its financial performance was not up to the expectations due to heavy interest on borrowed funds from the financial institutions.

It has, however, turned debt-free now after repaying the dues under a one-time settlement with the institutions with financial assistance from the State Government, Indian Space Research Organisation (ISRO) and Defence Research and Development Organisation (DRDO).

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