Context: According to Comptroller and Auditor General (CAG) report Army’s ambitious plan for modernization of the Army Base Workshops (ABWs) and implementation of the ‘Government-owned, contractor-operated (GOCO)’ model is delayed.

• The implementation of GOCO model is fraught with risks and operational challenges as identified by the Headquarters Base Workshop Group.

Key Issues

• Costly affair: The corporate world is driven by market forces, which means the GOCO model will be more costly. In most cases, private operators will want better infrastructure, which would have to be upgraded or replaced at government cost.
• Corporate management: Private operators may not have the expertise to deal with military equipment; they are also unlikely to absorb the existing manpower and will want a younger and better-trained workforce.

About GOCO (Government-Owned Company Operated) model

• In this model private industries will operate government-assets, sparing them of the need to invest in land, machinery or other support systems.
• The GOCO model was meant to modernise the workshops as well free up Army personnel from maintenance work.
• GOCO partner need not make investment in land, machinery and other support system.
• The selected private industry partner will get enough independence in implementing the mission using their best practices.

Current system

• Maintenance, repair and overhaul (MRO): The Army follows the traditional ‘womb to tomb’ life cycle support management for maintenance, repair and overhaul (MRO) of its costly equipment.
• Corps of Electronics and Mechanical Engineers (EME): It is responsible for the MRO system.

Need for GOCO Model

• High end technologies: In the last three decades, there has been a quantum jump in military technology and the MRO of military equipment has become very complex.
• Lack of infrastructure: However, some repairs and overhauls have run into problems on account of lack of infrastructure, spares and expertise.
• Poor performance of Corps: The infrastructure, expertise and work culture has not kept pace with time, leading to below par and inefficient performance.

Benefits offered by the GOCO Model

• Time savings: The main advantage of the model is that the targets are achieved in lesser time frame.
• Competitiveness: Also, it will boost competitiveness among the private entities paving way to newer technologies.
• Efficiency: The GOCO model will bring in corporate culture, leading to efficiency and accountability.
• Expertise: Private operators can easily go into partnership with Original Equipment Manufacturer (OEM), both for expertise and spares.
• Manpower saving: The government can save on manpower — 12,500 personnel workforce of the ABWs.
• Technical training: This model also opens avenues for absorbing trained retired personnel, which can be built into the contract.