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Pakistan Ordnance Factories requests resources for modernization plans

In a hearing with Pakistani Senate’s Standing Committee on Defence Production, Pakistan Ordnance Factories (POF) requested resources for its infrastructure plans.

As per the state-owned Associated Press of Pakistan (APP), POF’s Chairman Lt. Gen. Umar Farooq Durrani brief the committee on POF’s progress in exporting goods over past five years.

However, in order to increase production efficiency, lower costs and bolster competitiveness on the global market, Lt. Gen. Durrani appealed for financial resources for POF. POF stated that 80% of its machinery is over 40 years of age, which is hindering its ability to support domestic needs and compete internationally.

“If we manage to get new machinery we will be able to give better production at cheaper rates. This will also bring us in a position to share government’s burden,” Durrani said to the committee, adding, “We are also trying our best to meet our Armed Forces requirements as well as enhance our exports.”

As per APP, Committee Chairman Lt. Gen. (retired) Abdul Qayyum supported POF’s request, stating that POF should have modern machinery to produce quality and cost-effective products.

POF is Pakistan’s sole domestic supplier of ordnance munitions, such as small-arms ammunition, artillery rounds, rockets and other explosive materials. It is also the leading supplier of small-arms to the Pakistan Army. Its product catalogue largely comprises of licensed German designs, i.e. Heckler & Koch (HK) G-3 battle rifle and MP-5 sub-machine gun as well as Rheinmetall MG1.

The Pakistan Observer reported that the Committee was also updated on POF’s product efforts, claiming that the Committee was told that “production of modern assault rifles is also in final stages.”

Notes & Comments:

In 2016, POF had undertaken several preliminary and tentative steps to recapitalize its infrastructure, add overseas markets for export and modernize its product portfolio.

During Pakistan’s biennial defence exhibition IDEAS, which took place in Karachi in November, POF signed bilateral agreements with Czech, Polish and Italian companies, possibly to source new manufacturing equipment. POF also took steps to link itself to overseas supply channels, notably with Italian ammunition producer Fiocchi wherein Fiocchi would import brass materials produced by POF (in February, POF announced that it increased its brass output three-fold to 24,000 metric tons per year).

In terms of product advancement, POF’s most notable agreement was a letter-of-understanding (LoU) with the Czech firearms maker Česká zbrojovka (CZ) to “intensively negotiate [the] delivery of complete technology for the production of small arms to [POF].” CZ had submitted the CZ-807 modular assault rifle in 7.62×39 mm for tests in Pakistan. In April, CZ held a marketing demonstration of its goods in Baluchistan wherein a CZ official confirmed the LoU, stating “Recently we have signed a letter-of-understanding with POF, and we are ready to transfer, the full transfer (sic) of modern technology from CZ to Pakistan, to POF, so we can produce the most modern and most advanced assault rifles in the world at POF.” It is worth noting that the Prague has been openly supportive of increasing bilateral defence ties with Islamabad.

It is not clear where matters stand regarding the CZ LoU or the Pakistan Army assault rifle programs a whole, but Pakistan Observer’s report regarding the recent Senate Defence Committee meeting purports that POF is pushing to bring the assault rifle program and its plant modernization to fruition.

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  • by jigsaw
    Posted July 27, 2017 8:43 am 0Likes

    Sorry to say but with current government and its family centered policies, we’re more likely to see Sharif Ordinance Factories and Heavy Industries of Raiwind coming into existence than this being a priority.

  • by Bilal Khan
    Posted July 27, 2017 8:46 am 0Likes

    If those companies do this work and secure exports, that’d be a dream. Nope. Think more sugar and sugar candy production.

  • by Faisal Ur Rahman
    Posted July 27, 2017 10:16 am 0Likes

    POF should also look for anri-aircraft and dual purpose guns for army and naval use. They also need to keep an eye on AI and automation related developments. Perhaps some private sector joint ventures will be useful or involvement of local universities .

  • by Abdul Rashid
    Posted July 27, 2017 11:13 am 0Likes

    Not all doom and gloom for Pakistani exports. I just read The News International report on Pakistan signing a deal with Azerbaijan for ten Super Mushak aircraft.

  • by jigsaw
    Posted July 27, 2017 11:26 am 0Likes

    Pakistan could have achieved much higher exports if a solid drive and investment was behind these institutions but here priorities are misplaced…

    I just read tomorrow will be panama verdict…hopefully to get rid of this mafia and get things in place…

  • by Abdul Rashid
    Posted July 27, 2017 11:37 am 0Likes

    Even so, to be fair Pakistan is not doing too bad for a country of nearly 200 million running on auto-pilot with hardly any input from the almost non-existent government.

  • by Abdul Basit Iqbal
    Posted July 27, 2017 11:55 am 0Likes

    POF shall also explore Afghanistan as a potential export market. It will have manifold effect. 1) more exports, 2) induce soft power image, 3) Afghanistan armed forces will have PAKISTAN dependency, 4) Regional influence, 5) Less India & Iran influence

    And also to Central Asian republics…

  • by Rizwan
    Posted July 27, 2017 12:37 pm 0Likes

    POF should be privatized (in a smart and transparent way, not sold off to cronies at pennies on the dollar) and be able to stand on its own two feet, without having to ask the government for funding. Any business owned by the government is eventually bound to fail, e.g., PIA, Steel Mills. Bhutto’s nationalization of factories was a big disaster for Pakistan, from which we have never fully recovered. Many entrepreneurs and industrialists permanently left Pakistan at that time. A big loss. We have to realize that state ownership of enterprise is communism, not socialism. The Scandinavian countries are highly socialist, but Saab, Volvo or Ericsson are not state owned companies. We have to wean away from state owned enterprises, and foster private enterprise, which is competitive. The job of government is to foster and create a tax and regulatory environment in which private enterprise can flourish. The state also has resources to fund transfer of technology, and make it available to local enterprises for rapid development. PAC is doing well for now, but it is only a matter of time before bureaucracy takes over, the machines will be outmoded, and they will be asking the government for handouts. You do not see Lockheed, Boeing or GE asking their respective governments for funds to upgrade machinery.

  • by Abdul Rashid
    Posted July 27, 2017 1:01 pm 0Likes

    Perhaps all that Chaudhry Nisar has realised after 30 years is it’s finally…….. “Game Over”! Any decision on the Panama episode of our politics ought to better than confusion and standstill.

  • by Shakeel
    Posted July 27, 2017 1:37 pm 0Likes

    Apologies to Quwa’s PML-N & NS followers. They are doing a BLOOMING splendid job. Everything is rosy & dandy.

    On a serious note, I feel that POF is well positioned to make great advancements for Pak . It shows immense potential .Just hope they keep up the good work.

  • by Abdul Rashid
    Posted July 27, 2017 1:46 pm 0Likes

    By “Quwa regulars” I’m referring purely to those who comment here regularly. Not to Bilal’s mysterious “Quwa Team”.

  • by Khan Majeed
    Posted July 27, 2017 3:53 pm 0Likes

    This is a very nice move and hope POF will produce more excellent weapon systems in the future. Hope they create more jobs and also give me a job.

  • by Sami Shahid
    Posted July 27, 2017 5:16 pm 0Likes

    I remember when General Raheel was briefed about new machinery at POF… anyway, POF should really get the technology of CZ Bren 806 or 807 & if not then we should at least buy few thousand Bren 807 rifles for Army & FC deployed at the border with Afghanistan for COIN & Special operations.

  • by Steve
    Posted July 28, 2017 6:37 am 0Likes

    I agree with most of your post and it’s true for established products, and as a general principle. However for really high end new ground breaking products (like stealth, drones, self driving cars etc) it is not easy for private companies to invest in R&D which may take year and years to come up with a working prototype and cost 100’s of millions. State support is crucial. I listened to a DARPA lecture last year. They develop a prototype and when it works only then they give to LM or whoever depending on tender. Totally private self funding defence companies do not exist. You may not know how much the US government supports their defence industry with taxpayers money. As far as POF goes privatisation may be looked at but our experience that has been terrible in the recent past. It is also a core industry and security concerns will need to be resolved.

  • by Rizwan
    Posted July 29, 2017 2:28 am 0Likes

    We need to find the proper balance. My response was triggered by the request by POF for funds to upgrade their machinery. That is ridiculous. No doubt the government has a role in developing and transferring technology. Since we have no original research to speak of to develop new technology, all we can hope is for the government to fund transfer of technology for all the things you mention, like drones, stealth, or a zillion other technologies that we are so lagging in. In the US, the government funds original research and development of prototypes before handing them off to the private sector. Nowhere did I say that private industry should bear all the costs of development. Actually, the universities have a big role to play as well, which we are not utilizing. I’m sure you know that in the West, all new development comes about as a result of collaboration between the government, the universities and the private sector. In Pakistan, so far, we seem to be heavily dependent on the government to do everything. That is a very poor and inefficient use of resources. The universities can play a big role in transfer of technology as well, which is highly under-utilized in Pakistan. Most research is publicly available. Focused literature search on practically any subject can yield all the information needed to develop practically any existing technology, forget about developing new technologies. We have a long way to go before we can do that. Here is an amazing example of two young girls who learned how to build robots from the internet:

  • by Steve
    Posted July 29, 2017 8:48 am 0Likes

    Universities only have a role if the research is high end and ours is not. You can’t develop a turbofan engine for instance from a literature search. Important stuff in technology and the industrial protocols (steps to manufacture) are closely guarded secrets, not something a student can build in Pakistan. Even in the West it depends on tech infrastructure and maturity of knowledge and process. Pure knowledge and technology are two different things. The KRL was critiqued in West for handing out a bit too much tech details in a seminar they organised a few years ago. Either they were showing off or more likely did not plan and it happened inadvertently as we are c**p at process. We are not talking ‘robot wars’ that guys with a pile of scrap and electronics can build. I think the government should fund an upgrade as there is no other available alternative especially in the short term.

  • by Steve
    Posted July 29, 2017 2:40 pm 0Likes

    We can, as long as the Afghans don’t use our weapons to target us, and Panjsheri influence is reduced in Kabul. They are all Indian agents and highly anti Pakistan. Not going to happen in the near future. We gifted them a lot of MP-5’s a while ago and it did no good at all, possibly caused some of our border casualties.

  • by POF
    Posted August 17, 2017 7:38 pm 0Likes

    ooo helo brother this is one and only company in Pakistan for ammunition manufacturing.
    and privatization could bring many problems to the employs there. Said about Bhutto’s Nationalization of Factories well to my opinion its not disaster for Pakistan. Many companies will be owned by Gov. and many avg. families get their food, cloth and shelter from there and if you are saying that companies can’t perform under gov. that’s our fault because in gov. or pvt. sector there are human beings that are working but the efficiency of work is not optimized in gov. sector; if the level of energy and devotion of gov. sector employs become high then eventually gov. sector company can perform much and much better then pvt sector company.
    Well its all about the gov that eventually business bound to gov. fail, so rather than privatization change the gov and bring good gov. There are lot more companies which are working for producing parts for army products. PAC is doing well for now but when eventually it fails then you raise up and say that it should also be privatized in same manner you are saying now and after that eventually a time came when there is no company owned by Gov. and all is owned by pvt sector
    yeah i didn’t hear that kind of news that Saab, lockheed asking for money to upgrade machnery because they have potential buyers everywhere and even if single USA buy any product or even for overhauling of landing gears of c-130 they get contracts of 1 Billion USD. so they don’t need money because they don’t need. but here in comparison with POF that has only major buyer is POF and also other 40 countries listed for what export i don’t know about that exports. Getting 20 Million USD per year as per data of 2010 or 2012.
    If you have to support the country you also have to provide jobs to lower class population and in privatization it is merely possible to get all other benefits.

  • by Saleem raza
    Posted August 17, 2017 7:43 pm 0Likes

    POF should do JV’s and learn but firstly it came to advance machinery.
    Working on many platforms of guns will lead to dependency of PA on POF rather than imports and saving money. POF should creat and enhance its capabilites in AA and other big and small ammunitions to support and export purpose.

  • by Shakeel
    Posted August 31, 2017 12:17 pm 0Likes

    Dear Bilal,

    I have had too many sleepless nights worrying about the outcome of the rifle tender. It is nearly a year now since the provisional LOU with CZ BREN was signed. Surely this consultation phase/testing phase cannot last forever. Kalashnikov LOU has added another twist to the tale.

    Can you provide us any additional information about the latest twist or any inclination on how things might unfold. As always, your professional advice in held in high esteem.

    As a long shot, do you think that whoever wins the tender must be able to withstand possible American sanctions in the future?

    Come on CZ Bren.

    Thanks Bilal.

  • by Bilal Khan
    Posted August 31, 2017 3:03 pm 0Likes

    Available EXIM logs don’t show any recent rifle imports, so they’re not testing anything new right now. IIRC someone had said rifles weren’t budgeted for in the 16-17 budget either. In all likelihood things have been pushed, but HIT did press for modernization funding (incl. the new rifle program) a few months ago and the Senate Defence Production committee echoed HIT’s request. So…the effort is alive.

  • by Shakeel
    Posted August 31, 2017 3:32 pm 0Likes

    Thank you for the above update.

    Although the rifle tender is not a big ticket item, it does have a positive multiplier effect on the local economy. It will uplift the local skill base to a new. The casting techniques involved in rifle manufacturing requires a good local skills set. The Czech have demonstrated their quality control & TOT initiative when it helped POF set up the brass mill plant.

    Trust POF continues the good work

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