Inside
Pakistan’s
biggest business conglomerate
the Pakistani military, Lt.
General Davar
In
July 2016, the Pakistani senate was informed that the armed forces run over
50 commercial entities worth over $20 billion. Ranging from petrol pumps to
huge industrial plants, banks, bakeries, schools and universities, hosiery
factories, milk dairies, stud farms, and cement plants, the military has a
finger in each pie and stands today as the biggest conglomerate of all business
in Pakistan. However, the jewels in their crown are the eight housing
societies in eight major towns where prime lands in well-manicured
cantonments and plush civil localities in the possession of these societies are
allotted to military personnel at highly subsidised rates. Even military awards
are linked with the grant of farm lands and housing plots to military
personnel.
Shuja
Nawaz in his book, Crossed Swords, expounds the land grabbing
propensities of Pakistani generals. He goes on to say that in the “late 1980s, as dictator fatigue set in during the
Zia period, many army officers refrained from going out into the public in
their uniforms as there was much resentment against the military for their
over-indulgence in economic activities.” Later in 2007, “the country saw the jarring banners carried by
lawyers who were protesting the removal of a chief justice by the military
ruler: Ae watan ke sajeele Genrailo; saaray ruqbey tumhare liye hain (O’ handsome generals of the homeland, all the plots are
just for you).”
Genesis in the General
The “Culture of Entitlement” in the military started
during General Ayub’s time when he commenced the tradition of awarding land to
army officers (the size of allotment depending upon the rank of the
officer) in the border regions of Punjab and in the newly irrigated colonies of
Sindh. General Zia also created a novel way of involving serving officers in
commercial ventures by placing military lands and cantonments and the
provisioning of logistics to the regional corps commanders. Thus, many senior
army officers availed opportunities to acquire multiple plots in various
cantonments for themselves at highly subsidised rates. These prime properties
soon sparked nepotism in allotment and corruption among both the military and
civil bureaucracies.
After
being allotted plots in prime areas, it became common practice for army
officers to sell their preferential allotments at exorbitant prices to
well-heeled civilians. The military soon got involved in establishing
several foundations ostensibly to help retired service personnel. These
institutions virtually penetrated into all sectors of the economy and gradually
propelled the military into a major business stakeholder in Pakistan’s economy. The military operates its economic endeavours at three
levels with the ministry of defence (MoD) being at the top of the economic
military network.
The MoD controls four major
areas—the service headquarters, the
department of military land and cantonments (MLC), the Fauji
Foundation (also known as Fauji Group) and the Rangers (a paramilitary force).
The department of military land and cantonments acquires land for allocation to
the service headquarters, which distributes it among individual members. The
three services have independent welfare foundations, which are directly
controlled by the senior officers of the respective services.
The
military is also involved in public sector organisations like the National
Logistics Cell (NLC), the Frontier Works Organisation (FWO) and the Special
Communications Organisation (SCO), which are all controlled by the army. The
Water and Power Development Authority (WAPDA) was placed under military control
in 1998 with over 35,000 personnel now involved in its operations.
You name it and the
military has it
The MOD does not directly
manage the economic activities of the organisations under its control, but it
is an instrument to mobilise resources, accord legitimacy to the varying
commercial and other economic activities of its organisations and even field
formations and units which run many subsidiary commercial ventures
independently. In addition, there are four subsidiary organisations that are
involved in the economic activities of the military. These include the Fauji
Foundation, Army Welfare Trust, Shaheen Foundation (for retired Pakistan Air
Force personnel) and the Bahria Foundation (for retired Navy personnel). These
foundations, though controlled by their respective service headquarters, are
run by retired military personnel. The profits accruing from the commercial
ventures of these organizations are distributed to all shareholders who are
retired military personnel. These are engaged in ventures like fertiliser and cement
manufacture, cereal production, insurance and banking enterprises, education,
and information technology institutes, besides airport services, travel
agencies, shipping, harbour services and deep sea fisheries.
The
influence of the MOD plays a vital role in securing public sector business
contracts and financial and industrial inputs at highly subsidised rates. In
recent years, profit making by retired military personnel has acquired even
newer dimensions with them providing privatised security services to foreign
contractors in security-sensitive regions like the FATA and KPK (Federally
Administered Tribal Areas and Khyber Pakhtunkhwa). This follows the pattern as
established by foreign security contractors in adjoining Afghanistan.
The
Culture of Entitlement is getting stronger by the day. Several senior service
officers have also been parked as ambassadors, governors, and nominated on
other high-ranking bureaucratic posts in Pakistan. Successive army chiefs have
continued with the practice of strengthening the special perks and privileges
of their serving and retired personnel with respective civilian governments
reluctantly acquiescing to all the fair and unfair demands of the armed forces.
It is
an indisputable fact that Milbus contributes towards professionalism taking its
toll when the military participates in nonmilitary commercial activities. The
case of the People’s
Liberation Army (PLA) in China is a classic example where some senior Chinese
generals fell prey to the temptations of corruption and lucre. True to their
style, the Chinese government stepped in and severely punished some of the
offenders and thus discouraged the Chinese military from commercial activities.
Milbus
in Pakistan is the never-fading and ever-growing clout of its military in its
nation’s policies far beyond
strategic and security matters. A major reason for this state of affairs is the
independent, unaccountable financial muscle of the military. Since the Ayub era, no
civilian government has ever bothered to tame in the military except, to some
extent, Zulfikar Ali Bhutto for a short period. Most civilian governments have
looked the other way at the financial handlings of the military’s commercial enterprises, primarily
to buy peace with the powerful generals. Most members of Pakistan’s civil society and even its parliamentarians have
wilfully ignored the military’s economic empire-building except for some
senators like Sherry Rehman and Farhatullah Babar.
Among
the many constants in Pakistan, Milbus too, in the foreseeable future, is
likely to more than thrive as it is coterminous with the power wielded by the
military in its national affairs. Currently, there are no indicators whatsoever
that the Pakistan military will ever relinquish the primacy and unfettered
powers it enjoys in its nation.
Excerpted
from Lt. General Kamal Davar’s book Armed Forces and Their Corporate Interests with permission from Rupa Publications. We welcome your comments at ideas.india@qz.com.
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