Pakistan: The army as the state

Pakistan’s economy and institutions are deeply penetrated by the country’s army, a new book and documentary film reveal. Ehsan Masood reports for openDemocracy.
Ehsan Masood
12 April 2007

There are several scenes from Ziauddin Sardar's forthcoming film in the Dispatches series on Channel 4 television that I won't forget in a hurry. In one, Sardar has the pleasure of accompanying the Karachi police on a night-time anti-terror raid and is later brought face-to-face with a would-be suicide-terrorist.

In another, he walks out of a supermarket and proceeds to empty his shopping bag: out pops a box of cornflakes, followed by some washing powder, and more. Each item, he tells the camera, has been manufactured by a military-run conglomerate. As he leaves, the camera focuses on the building next to where he is standing: It is a branch of the Askari bank, a nationwide network owned by the Army Welfare Trust.

The trust is the second-largest private conglomerate in Pakistan. The largest is the Fauji Foundation (fauji means "soldier"). But the word "private" is something of a misnomer here as both these (and other conglomerates linked to the navy and air force) are run by serving army officers, and some were set up with public funds. Today, their combined assets could be as high as $20 billion.

The army's domain

Pakistan has famously been governed by generals for more than half of its sixty-year history as an independent state. Anyone born after 1977 will have experienced military rule for most of their adult life. On a day-to-day level, military rule is considered quite normal, as it was when I lived in the country in the years immediately after the military coup of 1977. I ate Fauji's cornflakes for breakfast, briefly went to an army-run secondary school, watched TV shows sponsored by the air-force, and would chat to army engineers as they rebuilt the road outside my grandparents' house. Since then, there has been a further expansion in military involvement in the economy. At the same time, an expanding urban middle class values the services that military-run companies provide, and has the money to pay for them.

What are these companies? They include manufacturers of modern consumer goods such as jelly and soap-powder - a legacy from the time when imports of western consumer goods were beyond the reach of all but the super-rich. But in addition to the national breakfast cereal, companies administered by serving military personnel also provide Pakistan with its banks, insurance companies, oil and gas, radio, TV, an airline, airport services, construction, agriculture, real estate, as well as schools and universities and one of the best-funded scientific research programmes for a developing country. The Pakistan military is not just an apparatus of the state: it is the state.

None of this is a secret. Indeed, it is not in the least considered strange nor unusual. People from all backgrounds compete for jobs in military-run industries. These are on the whole regarded as better-managed, and provide employees with higher salaries, better working conditions and significant perks compared with the non-military public sector. What Sardar's film and defense analyst Ayesha Siddiqa's book Military Inc: Inside Pakistan's Military Economy do is to inject a large dose of reality into the idea that it is acceptable for the army to be seen as some kind of benevolent guardian and with no external oversight. Sardar focuses more on the mutually-reinforcing thirty-year relationship between the generals and the religious-right - which is anything but over. Siddiqa, former director of naval research at the Pakistan navy, provides a detailed audit of the extent of military involvement in the economy and concludes that the military (the 550,000-strong army in particular) has in effect become a parallel feudal class - alongside the country's large landowners.

Even a straightforward reading of the numbers leaves a bitter taste. Military-linked commerce is responsible for some 4 percent of GDP. Its total commercial assets are worth some $4 billion. If the value of real-estate is included then the figure, according to Siddiqa, exceeds $20 billion. Out of 100 commercial projects run by army, navy and air-force conglomerates, only nine are listed on the stock exchange: the others do not need to report to any statutory or other public authority. Requests to come before parliamentary committees tend to be ignored, or referred to the ministry of defense or army headquarters, which between them act as a kind of apex body for many of the conglomerates.

Siddiqa does more than list the military's commercial assets: she demonstrates how the system has made millionaires out of senior commissioned officers many of whom are named in the book. The military and its four conglomerates own 12% of state-owned land. This is justified through a couple of British-era laws - the Land Acquisition Act (1894), and the Colonisation of Land Act (1912) - which gave the military the right to take over public land (the latter was abolished in post-independence India, but retained in Pakistan).

The military is prone to sequestering public land for its ever-expanding housing schemes. Some officers are also entitled to agricultural land, which was originally envisioned as a way of encouraging the middle classes to move to rural areas in an effort by earlier military rulers to break the dominance of larger landowners. Once it is taken over by the military, this land is then resold to serving officers for as little as $2 per acre, a small fraction of the market price. The highest ranks get more land, which they can either keep, or resell at its full market value. A general may have as much as $10 million worth of public land by the time he retires. According to Siddiqa, even the ancient 1912 act makes it illegal to transfer public land for private purposes. Despite this, some 2 million acres has passed in this way from state to essentially private hands since 1965.

Opening the books

A nation's military usually does much more than fight wars, and military-funded activities often benefit the wider society (where an army exists at all - Costa Rica and several small, mostly island, states around the world do not have armed forces). Army medical research has contributed to a better understanding of tropical diseases, for example. The humble microwave oven was initially patented by the defense firm Raytheon as a by-product during the development of radar in the second world war. But what Sardar and Siddiqa are telling us is that the Pakistani army, even by the often controversial standards of its peers abroad, is out of control and needs to be reined in through a combination of internal and external pressure.

Quite how and when (or indeed whether) there is internal pressure for change is another question, one that raises two problems. First, the film and the book will be widely read, watched and discussed and will undoubtedly spark much debate on pro-military sites such as the Pakistan defence forum. These critics will try to isolate Siddiqa as a western construct, and she in turn will need to convince the public that criticism of the military does not make her less of a citizen, or less of a patriot (even if the very fact that she is the first researcher to investigate military affairs in such detail says a lot on that score).

A second problem is that there seems to be no appetite for reform from the bulk of the Pakistani electorate, or from an opposition that is itself busy negotiating re-entry into politics with the army Whatever they may think of the military in politics, Pakistan's democratic governments have spent more on defense as a proportion of national spending compared with military dictatorships. Political parties also know that military-run services tend to be run marginally better than those in the public sector. This contributes to their popularity among an electorate that is thoroughly fed up with poor or failing public services. As a consequence people want to send their children to the military's network of schools; and they want to live in military-run housing schemes, where water, electricity and drainage are of better quality.

Pervez Musharraf himself knows this too. This is why reform of the military conglomerates is unlikely to be high on his agenda so long as he is in power, as the following speech from 2004 (quoted in Military Inc) confirms:

"The [housing] societies everywhere are the top societies of Pakistan. Now why are we jealous of this? Why are we jealous if somebody gets a piece of land, cheap when it was initially, and because of the good work done by the society, the price rises by 100 times and the man, then earns some money. What is the problem? Why are we jealous of this? There's no problem at all."

But there is a problem. Pakistanis may have a preference for army-run education or air-force-operated airlines, but they are fed up with feudalism. The last thing they will tolerate is a new feudal class of soldiers. It is a lesson that their military rulers must heed.

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