Pakistan: A quiet sort of military might

Across the army, navy and air force, conservative estimates put the value of the military’s business empire at more than $25 billion; on any normal day, it’s difficult to conduct commercial activity in Pakistan and not make the brass hats richer.

Your breakfast tea? That could be grown by Nurpur Farms, which is owned by the military. Likewise the pasteurized milk that goes with it. Fancy a tasty aloo gosht for dinner? Both the potatoes and the lamb could come from commercialized farms owned by military-owned Fauji Fresh n Freeze. Or maybe macaroni is preferred? That would come from the military’s Fauji Pasta.

With the eating over, it is time for work. Perhaps a few share trades on the roaring Pakistan Stock Exchange? Why not use the military-owned investment bank Foundation Securities in Karachi. You could park any profits in your account at Islamabad-based Askari Bank, also owned by the military.

And so it goes; the gas that powers the cooker, the cement used to build many Pakistani houses, the electricity for the lights, the petrol in the car, travel agencies, property development, transport and schools, hundreds of business entities across all areas of the economy, and all competing with the private sector.

Foundations

Between its army, navy and air force, Pakistan boasts a standing strength of 650,000 soldiers, the world’s sixth-biggest military force in its fifth-most populous country. Each fighting force has its own foundation, set up ostensibly to support ex-servicemen and their families after they leave the forces: the army-led Fauji Group (the word means soldier in Urdu, Pakistan’s official language), one of Pakistan’s biggest conglomerates; the navy-connected Bahria Foundation (bahria means navy in Urdu); and the air force’s Shaheen (falcon) Foundation.

“Fauji Foundation (FF) is poised towards constantly gathering, reviewing and analyzing the micro- and macro-economic situation to explore and capitalize the potential investment opportunities nationally and internationally,” the army’s group says in its mission statement: “FF is currently partaking in joint venture/equity investments in Pakistan and abroad.”

In 2016, Pakistani senators were told that the military controlled assets worth $20 billion. The Fauji Foundation generated a stated group turnover of $1.6 billion in 2015 and profits of $265 million.

Military analyst Ayesha Siddiqa has written extensively about the military’s grip on Pakistan’s economy.

In her book ‘Military Inc: Inside Pakistan’s military economy’, she estimates that 12% of Pakistan’s land area is owned by the military and that much of that is in the grasp of a handful of oligarchic generals, some of whom may be billionaires.

With its sweetheart deals and opaque activities, the military’s grip on the economy is a touchy subject in Pakistan. Syed Husaini, head of Askari Bank, declined to respond to questions about his business.

When Asiamoney broaches the topic in Karachi’s venerable Sind Club, our interlocutor, another senior Karachi banker, looks horrified, pivots to see who’s listening, lowers his voice and changes the topic.