Drone Strike Packages and Feasible Options for PAF

[Bilal Khan (Quwa)]

I think there needs to be a discussion on how exactly to "jumpstart" a private sector. Frankly, I have zero idea how to do this but perhaps a discussion can help.

It starts with instilling investor confidence.

You trigger enough investor confidence, the investors will figure out the funding, labor and all of the other inputs. But the key is instilling confidence.

Unfortunately, that's exactly where our armed forces have failed.

So, case in point, what kind of message did the Army send by ordering nearly $1b in arms from China? Well, they said, "let's help the Chinese industry." Thus, why would anyone in Pakistan invest in setting up that capacity if the Chinese can win?

If the armed forces had instead said, "we will now open a $10 billion program over 15 years to buy new-gen tanks, SPH and IFVs to the Pakistani private sector," then they'll see investor interest.

The next step is due diligence, which, again, our armed forces fails at.

But if it didn't, we'd write up an ironclad policy that requires a %-value of localization, and could break it down to part-by-part. It takes an insane amount of auditing, checks and accountability, which is where you have to give credit to India's CAG.

You then run a tender and see what options the local industry can bring.

In most cases, I suspect local investors will pair up with an outsider so that the latter accelerates the product development. So, for example, Turkey's Otokar could pair up with 'Hypothetical Sialkot Armor Company' to propose a localized variant of the Tulpar IFV. Together, they'd set up the manufacturing capacity, sort out the supply chain (to meet the localization requirement), and so on.

Whoever wins the contract, they'll start pumping the money to set up the capacity. They will use a mix of the Army's downpayment as well as loans, private investment and other funding means from their own end (they'll absorb the risk).

It's not as clean as I described it, the due diligence part can get messy and result in delays (due to back and forth with the industry). But it's doable. It's the model the Turks and Indians used to great effect, we can do so too.

Sadly, it's going to be harder I think, not only due to the malaise within the institutions, but the general disdain at which they've treated non-gov't/non-armed forces entities.

There's an irrational distrust of outsiders -- businesses, journos, analysts, etc alike -- and an aversion to the wider society. Coupled with a lack of mentorship, short-cut mentality, and all those other Pakistaniyat traits, it's tough, real tough.

 

[FOOLS_NIGHTMARE]

we need is large MALE UAV

A large MALE UAV is more economical to operate than a Gun Ship Helicopter as well. Image a full Regiment of Strike UAVs in an Anti tank role , repulsing any enemy misadventure.

I hear the excuse, "well US pressure," but then the others (Turks, South Africans, etc) keep saying they want to work with us.

Ukraine makes good Aero Engines as well,Turkey makes NATO standard munitions and avionics, South Africans are known for robust wings and Structures and our Chinese friends are jack of all trades.

official figure were never release

Countries like China operate drones in there thousands now, Turkey has hundreds of them and India is fast catching up . I think a dedicated COMMAND is the need of the hour, all our satellite and disused airfields should be allotted to the UAV command. A country like Pakistan needs UAVs in there hundreds.

 

[JamD]

It starts with instilling investor confidence.

You trigger enough investor confidence, the investors will figure out the funding, labor and all of the other inputs. But the key is instilling confidence.

Unfortunately, that's exactly where our armed forces have failed.

So, case in point, what kind of message did the Army send by ordering nearly $1b in arms from China? Well, they said, "let's help the Chinese industry." Thus, why would anyone in Pakistan invest in setting up that capacity if the Chinese can win?

If the armed forces had instead said, "we will now open a $10 billion program over 15 years to buy new-gen tanks, SPH and IFVs to the Pakistani private sector," then they'll see investor interest.

The next step is due diligence, which, again, our armed forces fails at.

But if it didn't, we'd write up an ironclad policy that requires a %-value of localization, and could break it down to part-by-part. It takes an insane amount of auditing, checks and accountability, which is where you have to give credit to India's CAG.

You then run a tender and see what options the local industry can bring.

In most cases, I suspect local investors will pair up with an outsider so that the latter accelerates the product development. So, for example, Turkey's Otokar could pair up with 'Hypothetical Sialkot Armor Company' to propose a localized variant of the Tulpar IFV. Together, they'd set up the manufacturing capacity, sort out the supply chain (to meet the localization requirement), and so on.

Whoever wins the contract, they'll start pumping the money to set up the capacity. They will use a mix of the Army's downpayment as well as loans, private investment and other funding means from their own end (they'll absorb the risk).

It's not as clean as I described it, the due diligence part can get messy and result in delays (due to back and forth with the industry). But it's doable. It's the model the Turks and Indians used to great effect, we can do so too.

Sadly, it's going to be harder I think, not only due to the malaise within the institutions, but the general disdain at which they've treated non-gov't/non-armed forces entities.

There's an irrational distrust of outsiders -- businesses, journos, analysts, etc alike -- and an aversion to the wider society. Coupled with a lack of mentorship, short-cut mentality, and all those other Pakistaniyat traits, it's tough, real tough.

Thanks for the insight...I've had this childish notion that a private military sector can do it themselves but now that I think about it, that's not true. All private companies (world over) that are successful live off government contracts. For example companies like Space-X would not be possible without the funding the US government put in. Various US agencies continue to fund private companies. DARPA funds a bunch of rocket companies whose sole reason for existence is DARPA funding. Puts things in perspective.

 

[FOOLS_NIGHTMARE]

It starts with instilling investor confidence.

You trigger enough investor confidence, the investors will figure out the funding, labor and all of the other inputs. But the key is instilling confidence.

Unfortunately, that's exactly where our armed forces have failed.

So, case in point, what kind of message did the Army send by ordering nearly $1b in arms from China? Well, they said, "let's help the Chinese industry." Thus, why would anyone in Pakistan invest in setting up that capacity if the Chinese can win?

If the armed forces had instead said, "we will now open a $10 billion program over 15 years to buy new-gen tanks, SPH and IFVs to the Pakistani private sector," then they'll see investor interest.

The next step is due diligence, which, again, our armed forces fails at.

But if it didn't, we'd write up an ironclad policy that requires a %-value of localization, and could break it down to part-by-part. It takes an insane amount of auditing, checks and accountability, which is where you have to give credit to India's CAG.

You then run a tender and see what options the local industry can bring.

In most cases, I suspect local investors will pair up with an outsider so that the latter accelerates the product development. So, for example, Turkey's Otokar could pair up with 'Hypothetical Sialkot Armor Company' to propose a localized variant of the Tulpar IFV. Together, they'd set up the manufacturing capacity, sort out the supply chain (to meet the localization requirement), and so on.

Whoever wins the contract, they'll start pumping the money to set up the capacity. They will use a mix of the Army's downpayment as well as loans, private investment and other funding means from their own end (they'll absorb the risk).

It's not as clean as I described it, the due diligence part can get messy and result in delays (due to back and forth with the industry). But it's doable. It's the model the Turks and Indians used to great effect, we can do so too.

Sadly, it's going to be harder I think, not only due to the malaise within the institutions, but the general disdain at which they've treated non-gov't/non-armed forces entities.

There's an irrational distrust of outsiders -- businesses, journos, analysts, etc alike -- and an aversion to the wider society. Coupled with a lack of mentorship, short-cut mentality, and all those other Pakistaniyat traits, it's tough, real tough.

Brilliant analysis you nailed the crux of the matter. Unfortunately our control freak big daddy attitude in all spheres ,has landed us where we stand today.

 

[Aspen]

Yep. Not to mention the woefully limited production run of the Burraq / CH-3A line, we're generally topping off at 20-30 systems for each type it seems.

Basically, there doesn't seem to be a cohesive drone program, and as such, Turkey and India have leapfrogged us in this regard, though we did have a private sector (e.g., ID) capable of the work if provided the policy, openness, etc.

It's not so much that our decision makers dropped the ball on what was already there, which is bad, but they've (at least from what we can see) arrogantly scoffed at others inviting them to partner/collaborate too (e.g., Turkey, South Africa, Ukraine, etc).

I hear the excuse, "well US pressure," but then the others (Turks, South Africans, etc) keep saying they want to work with us. So, someone's clearly lying, and I'm not sure if it's the ones who are actually progressing in the work...

Really well said

I think there needs to be a discussion on how exactly to "jumpstart" a private sector. Frankly, I have zero idea how to do this but perhaps a discussion can help.

It starts with instilling investor confidence.

You trigger enough investor confidence, the investors will figure out the funding, labor and all of the other inputs. But the key is instilling confidence.

Unfortunately, that's exactly where our armed forces have failed.

So, case in point, what kind of message did the Army send by ordering nearly $1b in arms from China? Well, they said, "let's help the Chinese industry." Thus, why would anyone in Pakistan invest in setting up that capacity if the Chinese can win?

If the armed forces had instead said, "we will now open a $10 billion program over 15 years to buy new-gen tanks, SPH and IFVs to the Pakistani private sector," then they'll see investor interest.

The next step is due diligence, which, again, our armed forces fails at.

But if it didn't, we'd write up an ironclad policy that requires a %-value of localization, and could break it down to part-by-part. It takes an insane amount of auditing, checks and accountability, which is where you have to give credit to India's CAG.

You then run a tender and see what options the local industry can bring.

In most cases, I suspect local investors will pair up with an outsider so that the latter accelerates the product development. So, for example, Turkey's Otokar could pair up with 'Hypothetical Sialkot Armor Company' to propose a localized variant of the Tulpar IFV. Together, they'd set up the manufacturing capacity, sort out the supply chain (to meet the localization requirement), and so on.

Whoever wins the contract, they'll start pumping the money to set up the capacity. They will use a mix of the Army's downpayment as well as loans, private investment and other funding means from their own end (they'll absorb the risk).

It's not as clean as I described it, the due diligence part can get messy and result in delays (due to back and forth with the industry). But it's doable. It's the model the Turks and Indians used to great effect, we can do so too.

Sadly, it's going to be harder I think, not only due to the malaise within the institutions, but the general disdain at which they've treated non-gov't/non-armed forces entities.

There's an irrational distrust of outsiders -- businesses, journos, analysts, etc alike -- and an aversion to the wider society. Coupled with a lack of mentorship, short-cut mentality, and all those other Pakistaniyat traits, it's tough, real tough.

Agree fully with everything you said

 

[Bilal Khan (Quwa)]

Thanks for the insight...I've had this childish notion that a private military sector can do it themselves but now that I think about it, that's not true. All private companies (world over) that are successful live off government contracts. For example companies like Space-X would not be possible without the funding the US government put in. Various US agencies continue to fund private companies. DARPA funds a bunch of rocket companies whose sole reason for existence is DARPA funding. Puts things in perspective.

Yep. Ultimately, be it Turkey, USA, Europe, or China (albeit not private sector, but the SOEs work at arms length from gov't), the local user's the main driver of growth.

In some areas, like fighter aircraft, it's totally unrealistic to expect the private sector to foot the bill for capacity, design, etc. It's too high risk and capital intensive, so getting PAC to take lead is a reasonable expectation. Of course, it can subcontract some work to the private sector, but it'll be low-key in most areas.

But for drones, armoured vehicles, fast attack crafts, patrol boats, small arms, etc, then there's no excuse. With a coherent policy across each, the armed forces alone could generate sufficient scale over a long enough period of time (15-20 years), so private investors have every reason to take lead.

The benefit is that you off-load a lot of the overhead from the back of the military (i.e., HIT, KSEW, POF, etc, do suck-up a lot of money) to the private sector. They'll run it all more efficiently, and in turn, the armed forces will have more money to spend on new arms or super-complex R&D programs like aerospace.

Sadly, we just haven't done enough to instill confidence.

 

[JamD]

Yep. Ultimately, be it Turkey, USA, Europe, or China (albeit not private sector, but the SOEs work at arms length from gov't), the local user's the main driver of growth.

In some areas, like fighter aircraft, it's totally unrealistic to expect the private sector to foot the bill for capacity, design, etc. It's too high risk and capital intensive, so getting PAC to take lead is a reasonable expectation. Of course, it can subcontract some work to the private sector, but it'll be low-key in most areas.

But for drones, armoured vehicles, fast attack crafts, patrol boats, small arms, etc, then there's no excuse. With a coherent policy across each, the armed forces alone could generate sufficient scale over a long enough period of time (15-20 years), so private investors have every reason to take lead.

The benefit is that you off-load a lot of the overhead from the back of the military (i.e., HIT, KSEW, POF, etc, do suck-up a lot of money) to the private sector. They'll run it all more efficiently, and in turn, the armed forces will have more money to spend on new arms or super-complex R&D programs like aerospace.

Sadly, we just haven't done enough to instill confidence.

Basically what the current government has said they will attempt to do for construction industry, they will need to do for the defence industry. Honestly, I've never heard of the phrase "defence industry" outside of military circles in Pakistan. There is no notion of defence production being an industry per say (even though it has it's own ministry). For special attention it needs to be recognized first. With the long list of issues that will take a higher priority, this seems unlikely.

 

[Bilal Khan (Quwa)]

Basically what the current government has said they will attempt to do for construction industry, they will need to do for the defence industry. Honestly, I've never heard of the phrase "defence industry" outside of military circles in Pakistan. There is no notion of defence production being an industry per say (even though it has it's own ministry). For special attention it needs to be recognized first. With the long list of issues that will take a higher priority, this seems unlikely.

The irony is that the defence industry is the easiest one to build as it already benefits from a massive cash outlay each year, and will stick for many decades to come. Likewise, the armed forces are sinking lots of funds into under-utilized overhead (like HIT or POF), money they can otherwise spend on acquisitions.

So, it all works out. In fact, it's not too different from where Turkey started out, which is what our generals used to quip at in the last 10-15 years. They'd ask, "how did they come up with all this? They got it from the West" ... well, duh, the Turks gave the job to their private sector, and their private sector figured out how to rope in the West to design nice solutions at a decent cost. Likewise for India today.

It's weird, but it's as if doing the obvious is morally wrong in Pakistan. We can't simply observe and learn, but we must pass judgement on others, and usually for no reason.

If they want to pilot this approach, then all the PA had to do was say it'll order 500 MALE UAVs over the next 10 years, and the winner gets all rights to supply them as long as (1) they manufacture a % of the value in Pakistan and (2) commit to the armed forces' delivery, logistics, support, etc requirements.

You've put $2 bn on the table, 50%+ of which will go back into your economy through manufacturing and support (let's say the rest are imports of critical tech). But the private sector would also put $500 m down to get the design, set-up the capacity, etc. So, the economic impact was a $1.5 b stimulus, and you got the 500 drones for a net-loss (currency wise) of $500 m. The private sector may also export $1 b in product, so you may get a $500 m gain.

From the standpoint of a policymaker, it all looks good. So, the real question is, who loses out?

 

[JamD]

From the standpoint of a policymaker, it all looks good. So, the real question is, who loses out?

Not sure if that was a rhetorical question or not but the only people I can think of is the heads of all these white elephant organizations that will lose their excuses to exist. They will also use the "national security" defence to claim these industries should be closely controlled. Of course this is mostly garbage.

I had a colleague once who had a habit of impressing external people while covering his own sheer incompetence by saying "this is classified". But that's just a loosely related anecdote I wanted to get off my chest lol.

 

[Bilal Khan (Quwa)]

Not sure if that was a rhetorical question or not but the only people I can think of is the heads of all these white elephant organizations that will lose their excuses to exist. They will also use the "national security" defence to claim these industries should be closely controlled. Of course this is mostly garbage.

I had a colleague once who had a habit of impressing external people while covering his own sheer incompetence by saying "this is classified". But that's just a loosely related anecdote I wanted to get off my chest lol.

Yep ... and it's the dumbest reason imaginable!

I mean, do these guys need to run this massive organization? Can't we just assign them to some post in the MoDP to chill out? Can't we buy some equity in the private sector and, in turn, send these guys into the Board of Directors (as silent members, but with voting powers)? Can't we manage the soost more efficiently?

 

[Falcon26]

The irony is that the defence industry is the easiest one to build as it already benefits from a massive cash outlay each year, and will stick for many decades to come. Likewise, the armed forces are sinking lots of funds into under-utilized overhead (like HIT or POF), money they can otherwise spend on acquisitions.

So, it all works out. In fact, it's not too different from where Turkey started out, which is what our generals used to quip at in the last 10-15 years. They'd ask, "how did they come up with all this? They got it from the West" ... well, duh, the Turks gave the job to their private sector, and their private sector figured out how to rope in the West to design nice solutions at a decent cost. Likewise for India today.

It's weird, but it's as if doing the obvious is morally wrong in Pakistan. We can't simply observe and learn, but we must pass judgement on others, and usually for no reason.

If they want to pilot this approach, then all the PA had to do was say it'll order 500 MALE UAVs over the next 10 years, and the winner gets all rights to supply them as long as (1) they manufacture a % of the value in Pakistan and (2) commit to the armed forces' delivery, logistics, support, etc requirements.

You've put $2 bn on the table, 50%+ of which will go back into your economy through manufacturing and support (let's say the rest are imports of critical tech). But the private sector would also put $500 m down to get the design, set-up the capacity, etc. So, the economic impact was a $1.5 b stimulus, and you got the 500 drones for a net-loss (currency wise) of $500 m. The private sector may also export $1 b in product, so you may get a $500 m gain.

From the standpoint of a policymaker, it all looks good. So, the real question is, who loses out?

To answer your question on who loses out, won’t generals and military officials that are used to kickbacks be an obvious losers in this arrangement?

 

[Caprxl]

We already have Burraq but it seems it is in need of some steroids to boost it.

Yes, it's climb rate is not amusing operators & payload capacity as well including on station time. But being the 1st indigenous attempt, giving the credit where due & it did get job done.

Wait for third and final quarter of this year for something which everyone has been asking for.

Let's wait for it.

You talking about MALE UAV from PAC brother? Last I heard it was hitting some snags but the guy in charge is very ambitious. Has taken the challenge head on & his passion shows will get the job done however it may take some time.

 

[Bilal Khan (Quwa)]

To answer your question on who loses out, won’t generals and military officials that are used to kickbacks be an obvious losers in this arrangement?

They can still get kickbacks from the private sector (e.g. jobs after retirement, bribes, etc). Really, the main loss here is control and misplaced sense of importance.

 

[PanzerKiel]

Yes, it's climb rate is not amusing operators & payload capacity as well including on station time. But being the 1st indigenous attempt, giving the credit where due & it did get job done.



You talking about MALE UAV from PAC brother? Last I heard it was hitting some snags but the guy in charge is very ambitious. Has taken the challenge head on & his passion shows will get the job done however it may take some time.

Procurements and employment.

 

[Caprxl]

Procurements and employment.

Yeah heard about it as well, should be up & running like you said, couple of batches of officers have already been trained. Hope to see em soon as you said.