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.
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.”