Tipu7
PDF THINK TANK: ANALYST
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The idea was to raise a handsome fleet of EFTs with new and surplus birds as a stop gap measure till materialization of NGFA project (the stealth fighter project under umbrella of Project Azam). The arrival of EFT was meant to close the chapter of F16 in PAF thus giving PAF more "breathing space" against US imposed restrictions. Su35 was also in consideration as backup plan for similar purpose as PAF leadership was also closely observing the political restrictions faced by Saudi EFTs during Yemen conflict. Meanwhile Jf17, due to collaboration of foreign vendors, was to evolve into a bird which could replace Mirages also. But none of it happened. And the sad part is, unlike most Pakistan Defense modernization programs, finances was secondary reason of failure of these plans.It was around this time the PAF officially announced Project AZM.
I don't think it's a mystery. If the PAF is working on a real NGFA, then it will need a sustained cash outlay of at least $200-250 m per year, and that's assuming most inputs are coming COTS from China. But if you're trying to convert those COTS inputs to domestic ones, then that spending easily climbs to $500-600 m per year.
So, let's average it out to $300-350 m per year. That's how much Project AZM needs.
And now while Indian Air Force's Rafales exists in physical form (in France though), Jaguar's Darin III upgrade is underway, Tejas Mk1 has received FOC and the work is underway for Super Sukhoi upgrade, we are still confused about our modernization program. After spending months in debating, PAF is now going to upgrade its Mirages AGAIN! and will possibly upgrade other birds too (minus F16). And the plans were to get rid of majority of all that old glorified junk by 2020 with much better replacement options.
Pakistan doesn't have the fiscal capacity to sustain both a NGFA and a costly import, not without flexible financing conditions on the latter (impossible due to FATF as per @airomerix)
FATF restrictions were imposed in near past. When all this EFT saga took place, there were no restrictions. And yes, grey listing by FATF hampers the military acquisition programs linked with Western World. However weapon systems which fall within category of defensive systems or supportive assets can be acquired, e.g. AEWCs, MPA, Transport Aircrafts, radar systems etc. Offensive assets like Fighter jets, combat naval vessels and armored vehicles, gunships are hard to get as long as we are not in the White list.
When it comes to combat capacity building we often face this eating-grass type situation. But when it comes to personal luxury expanses of our Military Elite, we rarely compromise below Farmhouse Villas.The PAF is now, officially, in 'eating grass' mode. Yes, it's not great in the short-term, it makes us look empty handed while all others are decking out with nice hardware. But all I ask is that we look at South Africa. Its projects (e.g., Cheetah, Rooivalk, Oryx, etc) came alive (albeit for a few years) because they ate grass, and now folks want their IP.