Solely owned by the Ministry of Defence, CSD is the most profitable retail chain in India

Vijay Mohan

Tribune News Service

Chandigarh, May 25

 As part of the efforts to reduce operating costs and revamp functional structure, the Army has issued orders to merge unit run canteens (URC) of the Canteen Stores Department (CSD) functioning from various static military establishments located in the same station.

Any one URC of a static unit, preferably the one with largest dependency, be nominated as the ‘merged URC’ and all other URCs be kept in ‘suspended animation’. URCs of those units that are likely to be affected by rotational movements should be exempted from the merger, a letter issued by the Quartermaster General’s Branch at Army Headquarters to the establishments of all three services on May 24 states.

Based on the recommendations by a board of officers (BOO) comprising all stakeholders, formation commanders, local military authorities and station commanders will have the leeway to nominate the merged URC, which should be centrally located so that it is convenient for all to commute, the letter adds. Station Canteens for ex-servicemen can continue in accordance with the BOO’s recommendations.

The letter also states that all URCs in suspended animation shall retain their names and URC Codes, but the supporting CSD depots shall not process any demands received from such URCs. Pro-rata portion of profit will be shared with the units of URCs kept in suspended animation under supervision of the headquarters concerned.

Last year the Minister of State for Defence, Shripad Naik, had stated in Parliament that while the government has not given any orders for closure of URCs. merger of URCs is a periodic process based on the number of beneficiaries in the area, proximity to other URCs and organisational efficiency. All efforts are made to ensure that there is no inconvenience to the clientele, including ex-servicemen, he had further stated.

Solely owned by the Ministry of Defence, CSD is the most profitable retail chain in India, selling a wide variety of products like groceries, household appliances, liquor, vehicles, cosmetic and sports equipment at subsidized rates to serving and retired armed forces personnel and civilians employed in defence establishments.

It has 34 depots and 3,809 URCs located across India and an inventory of over 4,000 products sourced from 436 companies. A significant amount of profit is generated by CSD out of which 50 per cent is deposited into the Consolidated Fund of India (CFI). For the 2019-20 fiscal, the amount deposited in CFI was 384.5 crore.  

Last year the sale of directly imported items, including liquor, in CSD canteens was stopped. As many as 422 such items were taken off the CSD’s inventory in a bid to promote indigenously manufactured products.

More recently, CSD has started online purchase for ‘Against Firm Demand (AFD)’ items, that include items such as vehicles and high end appliances. All purchases of AFD items are now being made through CSD’s online portal.h

CSD has also had its share of functional problems such as inadequate budgetary support, non-availability of certain products, pilferage of goods and delays in processing demands from clientele.