Dar suggests POF change its business model

Published: July 9, 2014
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Finance Minister Ishaq Dar in a meeting with POF Chairman Lt Gen Mohammad Ahsan Mahmood in Islamabad. PHOTO: PID

Finance Minister Ishaq Dar in a meeting with POF Chairman Lt Gen Mohammad Ahsan Mahmood in Islamabad. PHOTO: PID

ISLAMABAD: Pakistan Ordinance Factory (POF) needs to change its business model on commercial lines in order to become self-sustainable defense organisation, Finance Minister Ishaq Dar said on Wednesday.

Talking to a delegation from the POF led by its chairman Lt Gen Mohammad Ahsan Mahmood, Dar said that POF has potential not only to meet needs of the security forces but also become a forward looking self-sustainable defense organisation in ten years time, all provided it changes its business model on commercial lines.

Dar further suggested that teh POF consider incorporating private sector participation, though without compromising any of the basic roles of the POF.

The minister directed the management of POF to present complete financial model of its reformation and restructuring plan for consideration by Cabinet Committee on Restructuring.

Earlier POF Chairman presented a briefing on their proposed three phase reform and restructuring plan. The plan aims to bring efficiency and cost effectiveness in its functions with a view to create fiscal space for modernisation, diversity and sustenance.

Chairman POF said that the organisation’s management wants to bridge the technological gap by replacing old plants and machines from export earning and commercial sales instead of seeking grants from government. For this purpose the management has prepared a three-phase plan to change the working model of POF and make it self-sustainable in the next decade.

Dar assured the POF management of the finance ministry’s support in reorienting the POF’s strategic directions towards self sustainability and financial autonomy. However, Dar stressed that POF needs to be turned around in order to make it a proficient and efficient set up.

POF rebuts

A spokesperson of the POF has issued the following statement in response to this story:

“The report in The Express Tribune is factually incorrect. The reality is that POF went to the government, as it did with last government as well, to convince them that they need to allow POF to work on commercial model, which is futuristic and will actually turn POF in to a revenue generation set up and not look towards government grants. It is seeking government to allow it to run POF on commercial lines (as permitted in the POF Ordinance) that will make Pakistan Ordinance Factory self sustainable.”

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Reader Comments (12)

  • Jawaid
    Jul 9, 2014 - 11:54PM

    It is well known that while POF is a model of incompetence and mismanagement, it is also running a feudal estate in Wah area. The chairman is imported from the army and has no technical knowledge in running a technical factory but only runs a personal fiefdom as long as he remains there with the police and district management under his effective control. It may be mentioned that POF was established not by the army but by civilians led by Mr Laiq Ali, ex-PM of the princely Hyderabad state. At present, the army management is playing the role of revenue department, police as well as traffic controllers in Wah area. They collect taxes from residences, issue road permits after collecting road tax and control the cantt board. All revenue collected is expended on beautifying their “estate area” and providing subsidized utilities to their colonies, that includes no load shedding facility to these areas. The rest of civilian areas that have been encroached upon by POF are left in a shabby state while having to bear the extra electricity load of the estate area residents in the form of prolonged load shedding. Mr Dar has only to drive of the main Mall road to witness these facts by visiting localities like Lalarukh, Lalazar, New City etc. POF needs to be restricted to its factories rather than running a state within the state.

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  • Chachoo
    Jul 10, 2014 - 6:16AM

    In the Developed nations the CEOs and Chairmen of Defence and Research Oriented Organizations are highly educated Professionals with established Reaserch and Mangerial skills. in Pakistan in order to become a Chairman your stars on your shoulder are enough. How come a Leutenant General with no Research and Management background can run a Professional Defense Research and Production Organization?. How come they will lead any Research initiative with limited knowledge of State of the Art on their own.?
    Kindly Bring Civilian Professionals ( Engineers, Scientists ) on top level positions. An Army officer except from the Engineering Core have no qualification in engineering and they are recruited in FSc and do a bachelors in Humanity related subjects. It is against the Principles of Merit.

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  • Farooq
    Jul 10, 2014 - 9:53AM

    Similar is the case with HIT and PAC Kamra. They should be brought under a management with proven record like NESCOM, KRL and PAEC which are true defence organizations.

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  • Asim
    Jul 10, 2014 - 11:04AM

    A proper business model requires a relevant professional/technical mindset, not a paranoid military mindset.

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  • Safdar
    Jul 11, 2014 - 1:58AM

    It is ironical to read the comments. I know from the personal knowledge that it was not Mr Dar who came up with what has been reported, it is instead the POF management that is endeavouring to convince the previous and to present Govt as well to lift un-necessary restrictions on functioning of POF on commercial lines. Unfortunately typical bureaucratic approaches over the years have reduced POF to a Govt office as against a industrial set up which needs to run inline with the best practices. That is what is being pleaded for few years now and the management is convinced that should Govt allow POF to function as was envisaged by the visionaries like Mr Laiq and Mr Farooq in 50’s and 60’s it can become a self sustainable forward looking industrial setup. With regards to military bashing, suffice to say that travel from Taxila to Wah or Hassan Abdal to Wah and see the difference, it is only because it is being managed with some discipline and commitment. Instead of criticising we need to contribute and play our role.

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  • Agha haseeb
    Jul 11, 2014 - 2:04AM

    Mr Javaid, just try to see the model of PIA which has trained so many airlines crews and staffs in the past and where they are at the moment, PIA used to be pride of Pakistan are you still proud of it, POF was yes raised by our civilian brothers but being headed by Army Generals and still if is doing a wonderful job earning Foreign Exchange for the country. By the way these were the suggestions of Chairman POF and not Of worthy Finance Minister, the statements and recommendations were from POF,
    The record needs to be straightened
    Regards

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  • Asim
    Jul 11, 2014 - 10:14AM

    @Agha haseeb:
    Mr haseeb the question is cant they find a single person from among POF employees capable enough to head that to import a general. Afterall POF engineers have earned medals from international organizations. Why not depute a GM from POF to the army as COAS?

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  • Muhammad Iqbal
    Jul 11, 2014 - 10:47AM

    @Jawaid:
    if one goes the article carefully, the caption or the heading which states another elephant in the making?, it does not go by the basic theme of the article. i think we should forget about the personal differences and bad experiences. If we have to prosper then we have to rise above personal losses or gains. it is imperative to understand the theme of the article which actually begins from the para 5 ( Earlier POF Chairman presented a briefing), the basic idea was given by chairman which was duly endorsed buy the worthy finance minister.

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  • Muhammad Iqbal
    Jul 11, 2014 - 11:25AM

    @Asim
    Would you please be kind enough to suggest a name of GM from POF to be nominated as COAS..

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  • Tariq
    Jul 11, 2014 - 11:55PM

    POF started its journey in 1951 and still it is a reputed name at national/international level. We must be very careful while commenting on this national asset. Probably, it is the only organization which is improving itself according to time in terms of technology and other up-gradations. This news article is proof of POF’s endeavour towards modernization and self-sustainability. Things must be seen in totality. Title of the article is contrary to the material in it. Same article in other newspapers is as under:
    http://www.dawn.com/news/1118207
    http://www.officialnews.pk/58144/chairman-pakistan-ordinance-factory-meets-finance-minister/

    Mr. Jawaid, please note civilians as well as army personnels are doing their best to make this organization self-sustainable. Remember, personal grudges should not supersede the sanctity of a national asset.
    @Jawaid:

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  • Muhammad Mohsin
    Nov 17, 2014 - 11:03AM

    @Chachoo:
    FYI. The Chairman of POF is usually from the Corps of Engineers and He is Engineer by Profession.

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  • Sabeeh
    Nov 17, 2014 - 1:44PM

    In Pakistan, might is right. Everyone takes it’s undue share where they have power. In Air Force, all the 3 star generals are Pilots. 90% of 2 star as well. They have virtually enforced them on each and every important post even on Junior ranks. I wish there is justice everywhere

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