BMI View: Following the collapse of peace talks between the government and the Pakistan Taliban, and the decision to begin a military offensive in North Waziristan, we expect an escalation in domestic security threats though 2014 and into 2015. The government plans to deploy 150,000 troops to the region until 2017, which will increase pressure on military resources. The government has increased the defence budget for the current financial year, but additional funds may be required to quell the heightened security threat. Meanwhile, the increased cost of supplying the army in its ground offensive could detract funds away from the military procurement programme.
Defence spending is highly skewed in favour of the Pakistan Army, which is the primary branch of the armed forces. Meanwhile, the Pakistan Navy and Pakistan Air Force play a smaller role in national defence given the nature of strategic threats, which are primarily land based. However, defence chiefs have highlighted weakness in air and naval hardware in Pakistan, which is losing ground to India with regards to overall military capability. As a result, aircraft, ship, and submarine purchases dominate the current procurement plan.
The indigenous defence industry does not have the capacity to design and manufacture sophisticated weaponry such as this, and relies on international partnerships to supply the military. China is the main partner, supplying the majority of imported arms and licensing designs to Pakistani defence corporations which are manufacturing hardware, such as the JF-17 Thunder. The Pakistan Aeronautical Complex is manufacturing 50 Jets for the Pakistan Air Force, and is also looking to export to partners in Saudi Arabia, and potentially Myanmar. This will become the first major export for the Pakistani defence industry, which is largely geared towards supplying indigenous forces, with the exception of Heavy Industries Taxila (HIT) which has exported main battle tanks in the past.
The Pakistan Defence & Security Report features Business Monitor International (BMI)'s independent forecasts for national and international security, the defence industry, military expenditure, employment in arms production, and arms imports and exports, as well as examining industry trends and prospects, national and multinational arms producers and the regulatory environment.
BMI's Pakistan Defence & Security Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and regional competitive intelligence on the Pakistani defence and security industry.
- Benchmark BMI's independent defence and security industry forecasts on Pakistan to test other views - a key input for successful budgetary and strategic business planning in the Pakistani defence and security market.
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Global and Regional Political Outlooks
A strategic overview of the world's major political risks, identifying countries facing leadership successions and nations at risk of upheaval, inter-state conflict or separatism and insurgencies, plus a summary of the world's 'wild card' low-probability high-impact risks.
Snapshot evaluation of the major issues affecting the defence and security sectors, economy and politics, with issues subdivided into 'Strengths', 'Weaknesses', 'Opportunities' and 'Threats'.
Political Risk Assessment
Drawing on BMI's heritage of more than 25 years of Country Risk analysis, this comprehensively evaluates the key risks to domestic politics and foreign relations, focusing on issues most likely to affect either domestic security or the defence sector.
Security Risk Analysis
BMI's proprietary Security Risk Rankings provide a reliable - and country comparable - guide to conflict, terrorism and criminal risk, backed up by our analyst's latest assessment of each component. Furthermore, drawing on our country risk expertise, we assess the state's vulnerability to a serious - or prolonged - terrorist campaign.
Armed Forces Spending/Expenditure
The reports contain a detailed breakdown of areas of expenditure by the armed forces, these include spending on international deployments, WMDs and missile defence systems as well as individual breakdowns of the cost-per-soldier.
Domestic Security Overview
The domestic security overview lists the various potential internal security threats facing a country, ranging from internal security issues such as terrorism, cyber terrorism, crime and drugs, to external security issues including general defence procedures and potential threats from specific countries.
BMI Industry Forecast Scenario
Historic data series and forecasts to end-2018 for key industry indicators supported by explicit assumptions, plus analysis of key downside risks to the main forecast.
Budgets & Expenditure: Defence expenditure (local currency and US$bn); defence expenditure (% of total budget); defence expenditure (% of GDP); defence expenditure per capita, US$; defence budget (local currency and US$bn).
Employment: Employment in arms production (`000s); employment in arms production (% of labour force).
Macroeconomic: BMI's forecasts and analysis of all headline macroeconomic indicators, including real GDP growth, inflation, fiscal balance, trade balance, current account and external debt.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI's industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
Domestic Security Overview
The reports also provide a regional overview which details specific issues and flashpoints affecting , along with potential risks in the coming year.