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Pakistan’s Defence Budget More bang for the buck-II

(This is the SECOND of a THREE parts series on the subject).

Financial Discipline
We should strictly practice fiscal control. Most financial indiscipline takes place in Defence Procurement, Military Engineering Services, Army Supply Corps, Army Medical Corps, Electrical and Mechanical Engineers Establishments and Ordnance Corps Depots. It needs immediate and critical attention. Waste and corruption are twin partners in crime against the Defence Budget and the perennial losers are the fighting men. It is also time to conduct a survey wherein pure services like medical facilities, conservancy, maintenance, etc in fixed peacetime locations must be contracted out and the support services should be reduced as much as possible. After all we do not have to fight in Africa or Europe, so why have the same World War II British concepts? There are too many generals in the Medical Corps as well as in the EME. With honourable exceptions the Army Supply Corps (ASC) is a disgrace, quite in keeping with their brother supply establishments in different military forces of the world. One has to maintain the same standards of honesty and integrity throughout the service. With the advent of computers, a judicious use of it will permit a greater amount of control over leakages.

Supporting Services
The EME has bloated beyond recognition mainly because of the lack of standardisation in various equipment, particularly transportation. All fixed units and HQs should immediately dispense with first-line transportation, mainly jeeps, dodges, 2 1/2 ton M34 type trucks etc and hand them over to the fighting arms. An Officer Commanding a Combined Military Hospital or some such static unit has no need for spanking new Toyota Jeeps. In lieu they should be given 800-1000cc cars, Datsun type pickups and Bedford-type trucks. All administrative units like Logistics HQ should maintain central vehicle pools for administrative support of units in their areas. This is the only way to avoid blatant misuse of transport. It does nobody any good to see a UNIMOG vehicle plying in Karachi lugging water trailers. Water Bowsers mounted on Bedford Trucks are adequate instead of destroying our desert war mobility in administrative non-essential use. Our spare parts requirement every year is horrendous and the maintenance budget colossal. We must work out a Five to Seven Year Plan to replace all the vehicles of the Defence Services in a planned and phased manner based on standardized equipment indigenously manufactured. A number of well-known and reputable foreign companies offer transfer of technology and their offers should be considered on a priority basis, particularly if they include offset mechanism and Buy-Back programmes. These companies are providing different types of equipment which are satisfactorily being used by various defence services in diverse terrain and climatic conditions all over the world. Our one sided love with imported Mercedes Benz trucks continues and though one cannot detract from their quality but is it necessary to condemn all the others in any given “test and trials”? Something smells when you apply such a blatant scalpel to ward off potential competition. If things are allowed to continue in the same vein, one will have to change the Aim of the Army from defending the country’s ideological and sovereign frontiers to that of guarding the EME establishments.

Innovations
One of the finest lessons one learns in the Armed Forces is to “improvise”. The word may now kindly be changed in this high-tech age to “innovate”.

A lot of effort has gone into maintaining exceedingly high standards in the various training institutions of the Armed Forces at different levels. The soldier is kept under constant training in order to cope with the rigours and aspects of modern warfare in an electronic age, it has to be made more objective and greater emphasis on actual combat conditions have to be introduced. Great emphasis has to be placed on mind development permitting the military psyche to innovate in order to make up for the lack of superiority in numbers.

However, innovation has to start from the top. Gen Zia’s “cycle” campaign bombed out in the wake of the burning of the US Embassy in Islamabad but it was a symbolic gesture dictating the attitude towards cost-cutting and saving. Almost a decade later we can count in billions of rupees the cost of POL for non-productive use.

Real Estate and new Cantonments
Innovative schemes should have been prepared to meet the demands for Services housing. The Army Housing Scheme was a step in the right direction, but better financial management particularly by bringing in private sector participation is necessary. Most of our major cantonments are totally engulfed by civilian housing, particularly Lahore, Sialkot and Peshawar. By creating smaller cantonments in Pasrur, Daska, Narowal, Kasur, Lulliani, Raiwand, Umerkot, Badin etc one could have move the formations forward closer to their operational areas and pay for the cost of new cantonments by selling, at commercial prices, the land of the old! Taking commercial loans, one could have created officer and men married accommodation in Housing Schemes in the New Cantonments. Whenever possible cantonments must be moved from larger cities to within the parameters of restricted areas not easily accessible to civilians. The cost of maintenance of the old cantonments is not apparent but in actual fact is a considerable amount hidden into various station HQ budgets.

The Fauji Foundation, Army Welfare Trust, Bahria Foundation and Shaheen Foundation are awash with liquidity. Now that private investment banks are due to be sanctioned one could create a private investment bank from these funds which could finance the various industries for these Welfare Foundations and function also as a leasing corporation leasing out second-line transportation equipment for the administrative and fixed units of the Defence Services while also catering to providing investment capital for service-oriented organisations proposed to be shifted to private sector like the NLC, Army Dairy Farms, Constructions companies, etc. This investment bank would have the authority to float bonds, COIs, etc to finance schemes related to services to the Armed Forces.

Countertrade
The modern world is looking to Countertrade as a means of balancing financial deficits in foreign exchange. In the Defence Services there is certainly awareness of “Buy Back” schemes for encouraging indigenous production but a comprehensive understanding of the implications of international trade and the ensuring of meaningful transfer of technology escapes them. There is a great deal of lethargy in moving forward with decision making for local production with the effects translated into constant purchases by hard earned foreign exchange. Turkey paid for part of its purchases of F-16s from the US by tomatoes and has followed it up by making the jet engines of the F-16 aircraft in a transfer of technology — part “Buy Back” scheme. Since the defence services purchase a substantial amount of hardware, it stands to reason that they lessen their dependence on hard cash foreign exchange by resorting to Countertrades which even rich Muslim countries like Malaysia and Indonesia have now adopted for some years, besides Saudi Arabia, Nigeria, Iran and Iraq which regularly swap oil for hardware. A Countertrade package can be adopted with a basket of traditional and non-traditional export coupled with a sell-back of the items being produced indigenously. One of the main reasons for the Ministries of Finance and Commerce preferring Barter to Countertrade is that the present bilateral Barter trade with the Comecon Countries is being used actually as Countertrade and naturally they avoid any association with the Defence Services as the ensuing security investigation will uncover the fact that within these Ministries the Warsaw Pact countries not only enjoy total dominance but a great capacity for economic subversion.

Choice of Weapons and Equipment
We must make correct and early decisions about the choice of weapons and equipment. Inflation adds to the cost daily and it is suggested that a Reuters Terminal displaying fluctuating foreign exchange rates be kept in each decision making management cell in GHQ showing the increases necessitated DAILY to the cost of purchase by delays in decision making. The concerned officers can thereby see the effects of their intransigence. The important thing to remember is to make decisions which would affect the Armed Forces over a 5-10 years period, without the equipment becoming obsolete. We have an integrated Joint Chiefs of Staff Committee (JCS) and that should be the correct forum to take such decisions universally for the three services. The JCS must be made more effective as a means for enforcing standardisation. The purchase of Jaguar aircraft by India is a case in point where delay in decision making has made the aircraft obsolete before delivery. Without talking about the procedures followed, let it just be said that these are mostly outdated, antiquated and thoroughly made counter-productive by inordinate delays.
Though it is clear that injudicious hurry must not be the order of the day, it also follows that the present complacent attitude harbours on criminal negligence at least in certain cases, and it may be the result of motivated interest. Defence Services cannot afford to be parade ground outfits which they are apt to be, given unscrupulous arms merchants in various disguises of manufacturers, agents, consultants etc. The main items for future selection are the small arms, the artillery pieces, armoured vehicles, miscellaneous transportation and communication equipment. The General Staff is competent to recommend possible selections in such cases in less than a week if it does not get entangled in muddled technical specifications coloured to suit a particularly motivated viewpoint. This decision can be based on world-wide assessment by various analysts from diverse countries with the specifications well researched and the performances under various field conditions well documented. The same analogy can be reasoned as to why the Air Force did not ask for a “test and trial” of an F-16 before it bought the same? Because the technical competence and performance capabilities were available universally and there was no need to get involved in our own elongated in-house technical analysis, in which circumstances, one daresays that the F-16 would perhaps never have been purchased. Innovative swift decision making through the broad spectrum is the need of the hour.

THE PRICE OF FREEDOM — II
(This is the SECOND and CONCLUDING part of the suggestions for the Defence Budget)

Recently a group of Indian businessmen and social workers met the PM and implored her to take measures to stop the disinformation about India in the Pakistan media. A notable Pakistan columnist in a major local newspaper wrote a leading article deploring the fact that there were some militarists in Pakistan who raised the bogey of Indian invasion and occupation. These contentions are patently false, one cut of concealed motivation, the other from dangerously naive misconception, both have origins in the blatant Indian propaganda against our Defence Services.

The Sri Lankans have had a taste of Indian peaceful intentions by the conversion of their beautiful land into a holocaust by Indian Research and Analytical Wing (RAW), the finishing touches being given by the horrendously misnamed India Peace (??) Keeping Forces (IPKF). Nepal, the only Hindu Kingdom in the world and also land-locked, is being subjected to economic blockade by India bringing untold miseries on its people. Bangladesh is the constant target of manifold subversion by India, by supporting the so-called Shanti Bahini playing havoc to the once-peaceful Chittagong Hill Tracts area, by local support for an independent Hindu enclave in the west and by supporting cross-border attacks from the North by dissidents; about the Farakka Barrage the less said the better, the Bangladeshis are water-starved during winter and drowned by the thousands during summer. Maldives and Bhutan also have their own independent grouse, Sikkim, like the states of Hyderabad, Junagadh and Kashmir having disappeared into the great Indian democracy some time ago. About Pakistan, we rest our case, anyone who believes that the Indians have nothing to do with the events in Sindh, what to talk about Kashmir, the Wular Dam, etc must be regarded as plain stupid, the other alternative being considered unbelievable by us. It will not be a victory but a defeat for India is it is forced to try and invade and/or occupy us, sic Russians in Afghanistan, the best would be to Finland-ize or Balkan-ize us, with occupation troops in certain key areas to impose PAX INDIA-NA or to simply impose hegemony without using any troops while we are subject to their every whim, beck and call, a slave nation.

Reliance on Foreign Imports
For the foreseeable future, and as warfare becomes progressively more high-tech, the Defence Services will continue to rely on foreign imports for most of their weapons and equipment. Without any shred of doubt great progress has been achieved in the indigenisation of weapons and equipment but our priorities are still far from satisfactory and much more effort is required before we have to make the heavy outlays in foreign exchange which is a manifold loss to us. Not only do we have to spend our precious foreign exchange but we lose economically in the many benefits which would accrue because of local productions, e.g. more job opportunities, turnaround of local funds, etc. Part of this is because commercial institutions necessary to support a defence production programme has never been methodically organised. Even during the height of World War II, the defence oriented industries providing material for the war effort on both the sides were privately owned. True, these had been established for some time, e.g. Krupps, but we have never tried to put into place in Pakistan a system that can alternate for the private sector, we may not want monopolies like Krupps but certainly investment in defence-oriented industries has become a must. Fauji Foundation, Bahria Foundation, Shaheen Foundation and Army Welfare Trust are awash with funds and they do run various industries successfully — and not so successfully — depending upon the management expertise available. These institutions should be encouraged to invest in defence-oriented industries, at least 50% of their financial effort must be directed towards such projects. To provide funds for these industries, it would be appropriate for these institutions to have their own investment banks thereby directing funds from the private sector and their own capital lying virtually useless at this time to make a direct contribution to the defence effort. There is plenty of management expertise in the private sector in Pakistan available and this could be tapped by the welfare institutions of the defence services.

One believes that we must have a large but well balanced Military Research team with a significant budget attached to each of our Embassies in countries producing advanced weapon and equipment, two or three officers are not enough, we must emulate the Germans, Americans, British and Japanese pre-World War II. On the other hand we are liable to give colossal finds to units like Military Vehicle Research and Development Establishments (MVRDE) which really cannot give the desired results without generous input from our sources abroad. At the same time, we are visited by hundreds of military salesmen every year peddling their wares, there should be an organisation doing constant research and evaluation on the products being marketed. In some products, one cannot expect transfer of technology, other because of high-tech or economy in numbers but invariably we should ask any foreign company interested in selling its products to us to give out a technology transfer proposal.

In order to turn the disadvantage of reliance on foreign imports into an advantage, we must ensure that any sales made to us must not only include transfer of technology but also an offset mechanism wherein some of the products being made in Pakistan is re-purchased by the foreign Principal. In this manner we will not only ensure cost effectiveness and maintenance of quality which are self-explanatory but also create a demand for exports to the third world countries. A possible scenario can be say for the purchase of armoured personal carriers. The General Staff selects an armoured personnel carrier for the next decade or so and gives out the number to be produced. An agreement is then made about the possible price, with realistic escalation clause. The foreign Principal then sets up a Joint Venture Project or give only technical know-how to the Project with a company formed by Fauji Foundation or Army Welfare Trust, who turn for their local funds from their own investment bank for their Project as well as look for private sector partners who would be then interested, given the Defence Services commitment to back participant interest in the enterprise. The foreign Principal will also have to buy-back part of the production for sales through their own sales network. At the same time, with the help of the foreign Principal or otherwise, we can expect to sell some of the items produced to third world countries. This scenario incorporates transfer of technology, employment opportunities, quality control, financial inputs, private sector enterprise, cost control and effectiveness, foreign exchange earned through Buy-Backs, etc.

Evaluation of Equipment for induction
When there is no choice but to purchase foreign equipment, there must be a clear-cut evaluation procedure which must be able to see through open chicanery. There is a tendency to award the tender to the lowest bidder but a more correct method is to have an evaluation system that works on a point system, 40% being kept for lowest bidder, 60% for technical evaluation. The normal penchant for unscrupulous manufacturers is to give a low price and then more than make up in spares. There is a joke that Mercedes is so well established in the Defence Services, instead of being paid for the product they will pay you to take the product and still make a profit — in spares. Beside technical evaluation, we must also look at amortized costs including depreciation, cost of spares, cost of POL (a vehicle may have more fuel consumption than the other; over 15 years or whatever is thought to be the combat life, the extra price must be added to the tendered price), technology transfer wherein the intention to make the product here must be taken into account, etc. We must not allow our evaluation process to become a sham or even a make monkeys out of us. It behoves us to go for the best that money can buy — but properly processed for the amortized cost, we cannot afford to have impaired quality for our Armed Forces, shoddy goods will result in shoddy defence.

The Defence Services as a Deterrent
Freedom has a price and nations who have an inbuilt urge not to be enslaved pay that price by sustaining a credible deterrent, world opinion has its merits but military power is the one universal language that everyone respects, particularly regional bullies. Policies of appeasement end up like Munich pre-World War II, a case history for inviting trouble. Chamberlain spoke of “peace in our time” but a fearsome world war, as predicted by Churchill did come about, as surely as night follows day. A media campaign is being run, not by Pakistan, but against Pakistan a disinformation exercise is afoot but we are the victims, not the perpetrators. In 1962, Indian papers proclaimed “Jawans swing into action!” and “Prime Minister orders the Army to its duty”, and so on and so forth. Ten days later, as recounted in Neville Maxwell’s “India’s China War”, India was screaming to high heaven that she had been attacked by China! At that time the Prime Minister of India was none else than that apostle of peace, Jawarharlal Nehru, who having swallowed Goa, Daman and Div from the Portuguese earlier in the year was feeling his oats and took on the wrong customer. He was Rajiv Gandhi’s grandfather, at least his mother was no hypocrite and never hid her more martial leanings.

The Armed Forces of Pakistan need all the money that they can get to modernize and expand the only credible deterrent to Indian hegemony in the South Asia sub-continent. Apologists would have us accept Indian tutelage as a fait accompli, it is not the first time that liberal intellectuals have given encouragement to an enemy by such a stance, Hitler often quoted Oxford University’s famous debate resolution, “This House will not fight for King and country”, or some such to his generals as an example of the decaying of the British will to fight. The fact that respected columnists in some of our major newspapers have taken on a similar refrain is alarming — and a measure of the efficiency and effectiveness of the Indian Psy-war machine.
The mission of the Armed Forces of Pakistan is to defend the territorial integrity and sovereignty of Pakistan at all costs, in the fulfilment of which the prime requisite is to prepare for war. Over the past year, the political climate has become more conducive for the Armed Forces, particularly the Pakistan Army and today a popular, much beloved institution is much better psychologically equipped to accomplish its mission. Free of bad vibes from the masses, the Defence Services have relished going back to their primary and only role.

Summary
An apology must be made because of the generalities made and the sketchiness of the treatment of an important subject necessitated by reasons of maintaining security. Air Marshal (Retd) Nur Khan had said last year that a 20% budget reduction is possible just by cost cutting without equipment manpower-deletions and he was supported in this by Lt. Gen. (Retd) K M Shaikh who had used a figure for saving of over Rs: 4 billion (US$250 million). This is quite a substantial sum and given the credibility and expertise of these two profound and respected military minds, can be deemed to be more or less correct. Why not incorporate such men of known stature and make a committee including known honest military minds?

It behoves us to draw up all our efforts into making our war machine strong within the resources available and that means ruthlessly ensuring that every penny counts.

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