The business conglomerate that is the Pakistani Army, which has fingers in multiple pies across the business spectrum, has now moved into the oil business.
Recent growth of businesses controlled by the powerful army has been spectacular. In 2016, for instance, the Pakistan Senate was informed that the army’s commercial wings, namely the Fauji (Army) Foundation, the Shaheen Foundation, the Bahria Foundation, the Army Welfare Trust and the Defense Housing Authorities, owned around 50 business concerns and housing property worth over $20 billion. Three years later, this number now runs into the hundreds of businesses with net investment reportedly exceeding $100 billion.
Dr. Ayesha Siddiqa, a Pakistani military scientist and author of the acclaimed book “Military Inc.” told the Asia Times: “The army’s total stake in private businesses in the country is more than $100 billion. They are underestimating their investment and disguising their involvement through public sector organizations like (the) National Logistic Cell, Special Communications Organization and Frontier Works Organization, which are exempt from annual audit and scrutiny.”
She said one of the leading military-business conglomerates in Pakistan was the Fauji (Army) Foundation. In 2005, she recalled, the elected parliament was snubbed by the Ministry of Defense after it questioned a controversial business transaction that undersold sugar mills.
Siddiqa revealed that “Milbus-related” resources do not follow the norms of accountability prescribed for government institutions: “The term ‘Milbus’ refers to military capital that is used for the personal benefit of the military fraternity, especially the officer cadre, but is neither recorded nor part of the defense budget. In this respect, it is a completely independent genre of capital.”
Dr. Siddiqa, who also serves as a research associate at the SOAS South Asia Institute, University of London, said that military involvement in socio-economic activities undermines professional competence by focusing on non-military commercial activities instead of devoting themselves to core military duties and responsibilities.
The newest expansion of army business is a move into the oil sector. It is in addition to dozens of businesses the military already runs in Pakistan including companies in the spheres of banking, food, retail superstores, cement, real estate, housing, construction, private security services, and insurance.
The Frontier Oil Company (FOC), a subsidiary of the army-managed Frontier Works Organization (FWO), has now been granted a contract for the construction of a 470km-long oil pipeline estimated to cost $370 million.
Ironically, the Economic Coordination Committee (ECC), which granted the contract to the FOC in mid-February, violated its own decision made in April last year. The then prime minister Shahid Khaqan Abbasi had approved the granting of the contract for the white oil pipeline to the government entity Inter-State Gas System (ISGS). The former government of Abbasi was of the view that since ISGS was already involved in the execution of the proposed TAPI and North-South pipelines, they should have no difficulties in the execution of Machike-Taru Jabba High-Speed Diesel and Motor Spirit pipeline.
An official of the state-run ISGS told Asia Times upon the condition of anonymity that the ECC failed to honor the decision of the previous government that awarded the pipeline contract to ISGS.
“It is strange that the Oil & Gas Regulatory Authority (OGRA) granted a construction license to FOC well before time without informing the previous government, while the ISGS, which is part of the petroleum ministry, is yet to be considered for a license,” the official said. He pointed out that OGRA violated the cabinet decision of April last year in which the ECC empowered the federal cabinet to vet and approve the proposals for oil pipeline projects. Whatsmore, he said, “The previous government had approved the pipeline at a cost of $280 million which is $90 million less than the projection of FOC, but the contract was still awarded to FOC.”
Pakistan People’s Party (PPP) Secretary General and former Senator Farhatullah Babar told Asia Times, “The parliamentary proceedings show that all is not well with the manner in which business contracts are awarded to military-run enterprises.” He claimed that lucrative toll collections at motorways was acquired by the Frontier Works Organization on a long-term basis without inviting bids. Babar said that massive involvement of the army in non-military business activities has attracted the attention of Parliament as well as of the Supreme Court.
“The military’s institutional strengths and advantages are well known. Backed by these strengths the military commercial wings always use unfair means to compete with other competitors and acquire commercial enterprises and get contracts in a non-transparent manner. Potentially it will have negative consequences for business as a whole because private businesses (are not competing on) a level playing field.” Babar added.
My family every time say that I am wasting
my time here at net, but I know I am getting experience daily
by reading thes good articles or reviews.
Thanks for the auspicious writeup. It in reality
was a entertainment account it. Glance complex to more brought agreeable from you!
However, how can we be in contact?
Hi there everyone, it’s my first pay a quick visit at this web
page, and paragraph is actually fruitful in support of me, keep up
posting such content.
Fantastic post however , I was wondering if you could write
a litte more on this topic? I’d be very thankful if you could elaborate a little bit further.
Appreciate it!
It’s in reality a great and useful piece of info. I am happy that you simply shared this useful
info with us. Please stay us up to date like this. Thanks
for sharing.
This is a topic that is close to my heart…
Thank you! Exactly where are your contact details though?
Hey There. I found your blog using msn. This is a very well written article.
I’ll be sure to bookmark it and come back to
read more of your useful info. Thanks for the post. I will certainly return.
It’s remarkable for me to have a site, which is good
for my experience. thanks admin
Excellent post. I’m going through some of these issues as well..
I read this paragraph completely regarding the
comparison of most recent and earlier technologies, it’s amazing article.
Pretty! This was a really wonderful post. Many thanks for supplying these details.
Piece of writing writing is also a fun, if you know after that you can write or else it is complicated to write.
Hey, I think your site might be having browser compatibility issues.
When I look at your website in Ie, it looks fine but
when opening in Internet Explorer, it has some overlapping.
I just wanted to give you a quick heads up! Other
then that, great blog!
I quite like reading an article that can make men and women think.
Also, thank you for permitting me to comment!
This paragraph will assist the internet people for setting up
new website or even a weblog from start to end.
Hello! I could have sworn I’ve visited your blog before but after going through some of the posts I realized it’s new to
me. Regardless, I’m certainly pleased I found it and I’ll be bookmarking
it and checking back regularly!
Hey there are using Wordpress for your blog platform? I’m
new to the blog world but I’m trying to get started and
create my own. Do you need any html coding knowledge to make your
own blog? Any help would be greatly appreciated!
Thank you for every other informative website. The place else may I am getting that kind of information written in such an ideal means?
I have a project that I’m just now working on, and I’ve
been at the look out for such info.
Asking questions are genuinely nice thing if you are not understanding anything fully,
however this piece of writing provides fastidious understanding yet.
You’re so interesting! I don’t think I have read through something like that before.
So wonderful to discover someone with a few original thoughts on this topic.
Really.. thank you for starting this up. This web site
is one thing that is needed on the internet, someone with a bit of originality!
I’ll immediately clutch your rss as I can not find your email subscription hyperlink or e-newsletter service.
Do you’ve any? Please let me realize so that I may
subscribe. Thanks.
If you want to improve your experience just keep visiting
this website and be updated with the most recent information posted here.
Thank you for the auspicious writeup. It in fact used to be a leisure account it.
Look advanced to more added agreeable from you!
By the way, how could we communicate?
Fantastic beat ! I wish to apprentice whilst you amend your web site, how can i subscribe for
a weblog site? The account aided me a applicable deal.
I were tiny bit familiar of this your broadcast
offered shiny transparent concept
What a stuff of un-ambiguity and preserveness
of precious knowledge about unpredicted feelings.
Great article. I will be going through a few of these issues as well..
I was pretty pleased to find this site. I need to to thank you for your time due to this fantastic read!! I definitely appreciated every bit of it and I have you book marked to see new information in your blog.
Its not my first time to visit this website, i am browsing this
site dailly and get fastidious data from here everyday.
I used to be suggested this blog via my cousin. I am now not sure whether or not this put
up is written via him as no one else understand such precise about my trouble.
You’re amazing! Thank you!
I would like to thank you for the efforts you have put in writing this site.
I am hoping to see the same high-grade blog posts from you in the future as
well. In fact, your creative writing abilities has
encouraged me to get my very own website now 😉