Business Monitor International

Pakistan Defence & Security Report

Published 18 June 2014

  • 91 pages
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  • Includes 3 free updated quarterly reports
Pakistan Defence & Security Report

BMI View: Despite Nawaz Sharif 's plans to b e gin peace talks with the Taliban and to address major security issues, we expect Pakistan's domestic security situation to remain highly fragile . In September 2013 , Nawaz called an All Parties Conference which gave him the green light to beg in negotiating with the Taliban. However, talks have already stalled and Nawaz ' s plans are in tatters. Regarding the defence industry, we expect Pakistan to continue to pursue defence relationships with a range of powers including Saudi Arabia, Turkey and South Korea. This will be essential in avoiding overreliance on the USA and China for military equipment.

We remain sceptical on the outlook for successful peace talks between the government and Pakistan's militant groups. While Prime Minister Nawaz Sharif has taken the positive step of declaring that he favours a dialogue with the Taliban rather than pressing ahead with a military strategy that shows little sign of working, we emphasise that peace talks are likely to end in impasse over coming years. A positive development in the security sphere has been the appointment of Raheel Sharif as the new Pakistan army commander after the departure of General Kayani in Q413. So far, the army has cooperated well with the government with the prospect of military coup remaining low.

The military now appears to be gearing up for what will be the biggest procurement programme in its history - the long-delayed acquisition of six new submarines worth up to UD4bn. China is in pole position to secure the contract, but Pakistan has recently signed defence industry collaboration agreements with South Korea and Turkey, and they both have a realistic chance of securing the order.

Another important milestone for the Pakistani defence industry will soon arrive with a first export order for the JF-17 fighter aircraft, a mainly Chinese design now being manufactured in Pakistan. The most likely primary purchaser will be Saudi Arabia,...

Table of Contents

BMI Industry View
Pakistan Security SWOT
Pakistan Defence & Security SWOT
Business Environment
Industry Forecast
Defence Budget
Table: Defence Expenditure (Pakistan 2011-2018)
Table: Defence Expenditure Scenario - Changing % Of GDP (Pakistan 2011-2018)
Armed Forces
Table: Armed Forces Personnel (Pakistan 2001-2011)
Table: Manpower Available For Military Service (aged 16-49 unless otherwise stated) (Pakistan 2011-2018)
Table: Defence Trade Balance (USDmn) (Pakistan 2011-2018)
Table: Defence Exports (USDmn) (Pakistan 2011-2018)
Table: Defence Imports (USDmn) (Pakistan 2011-2018)
Macroeconomic Forecasts
Economic Analysis
Table: Pakistan - Economic Activity
Industry Risk Reward Ratings
Asia Security Risk Ratings
Table: Asia Pacific Security Risk Ratings
Table: Asia Pacific State Vulnerability To Terrorism Index
Pakistan Security Risk Ratings
Market Overview
Pakistan Defence Market Overview
Armed Forces
Table: Pakistan's Nuclear-Capable Ballistic Missile Arsenal
Table: Exports From Pakistan
Pakistan Security Overview
Domestic Threats
Regional Threats
International Threats
Company Profile
Air Weapons Complex
Dr AQ Khan Laboratories
Heavy Industries Taxila
Pakistan Aeronautical Complex
Pakistan Ordnance Factories
Regional Overview
South Asia Security Overview
Global Industry Overview
Global Political Outlook
Industry Forecast Methodology
Sector-Specific Methodology
Security Risk Ratings Methodology
Table: Indicators And Weighting

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.

Key Benefits

  • 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.

    SWOT Analysis

    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.

    Company Profiles

    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.

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'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc