Ashish SinghNew Delhi: Pakistan today is a country mired in economic crisis. Inflation hovers at crushing levels, foreign reserves are perpetually under strain, and successive governments plead with the International Monetary Fund for bailouts. Yet, amidst this bleak picture, there exists an island of privilege. For those wearing the naval crest, hardship is not the defining reality. Instead, a parallel economy thrives—built not on innovation or enterprise, but on state patronage and military muscle.
At the centre of this privileged universe stands the Bahria Foundation, founded in 1982 under the banner of welfare for Navy personnel. What began ostensibly as a welfare initiative has since grown into a sprawling corporate conglomerate with interests ranging from shipping and logistics to schools, bakeries, real estate, and even universities. The Foundation’s name is emblazoned across Pakistan, but its inner workings remain shielded by secrecy and the Navy’s institutional clout.
Welfare or Monopoly?
The Foundation’s origin story carries a moral gloss: to support veterans who had given their best years to the service of the state. Few would object to the idea of ensuring sailors’ families are not left destitute. But the reality diverges dramatically from the rhetoric. Instead of functioning as a modest welfare vehicle, Bahria Foundation has become a corporate juggernaut, protected by tax exemptions, fuelled by government contracts, and managed almost exclusively by retired admirals.
This “revolving door” between the uniform and the boardroom is no coincidence. Retired Vice Admirals routinely ascend to the role of Managing Director, ensuring that those who once oversaw naval procurement and projects now preside over lucrative business subsidiaries. Admirals become executives, captains become directors, and the Foundation guarantees a second career to the naval elite. In theory, its profits should flow back into veterans’ welfare. In practice, there is little evidence that revenues beyond modest stipends reach ordinary sailors. What is visible, however, is the Foundation’s relentless expansion into commercial territory that should be reserved for competitive, civilian enterprise.
State Patronage, Private Gain
Unlike ordinary businesses, Bahria Foundation operates on tilted ground. Tax exemptions form the first layer of privilege. Properties exchanged under its umbrella evade levies that cripple ordinary buyers. Vehicles are imported with reduced duties. Revenues accumulate without the erosions suffered by civilian competitors.
The second layer lies in preferential access to contracts. Construction tenders, dredging projects, shipping licences, and bonded logistics hubs have all been awarded with little transparency. Civilian firms complain of competing not against efficiency or cost, but against institutional muscle. One example is the Bahria Transshipment Hub of Pakistan near Karachi, a bonded facility strategically located to control port flows. Another is Maritime Technical and Support Services, which openly markets itself as providing maintenance and underwater work for naval ships, submarines, and aircraft. Together, these privileges create a two-tier economy: one where ordinary entrepreneurs wrestle with regulation and taxation, and another where military-run enterprises flourish under a protective shield.
The Real Estate Question
Perhaps the most visible manifestation of naval privilege is in housing schemes. Entire neighbourhoods in Karachi and Islamabad—Naval Anchorage foremost among them—have been carved into gated enclaves for officers, often at subsidised rates that bear no relation to market prices. Land acquired cheaply becomes capitalised wealth, converted into speculative assets when sold at full market value.
In Gwadar, where local fishermen are displaced and the city still grapples with water shortages and erratic electricity, the Pakistan Navy Benevolent Association has launched its own Naval Anchorage project. While the rhetoric is about “welfare,” the symbolism is striking: in the very city touted as the jewel of the China-Pakistan Economic Corridor (CPEC), locals cannot access basic services, but officers receive privileged access to prime coastal land.
The Bahria Town Karachi scandal—where the Supreme Court ordered a Rs 460 billion settlement for illegally acquired land—offers a cautionary parallel. Although Bahria Town is a private developer distinct from Bahria Foundation, the overlapping names and the repeated misuse of land show how Pakistan’s land economy has become a favoured playground for military interests.
Ignored Audits, Weak Oversight
The culture of impunity is reinforced by the absence of effective oversight. Pakistan’s Auditor General has repeatedly flagged discrepancies in defence accounts, including procurement violations and unaccounted fuel worth hundreds of millions of rupees. Yet, parliamentary oversight is cosmetic at best. Since the mid-1980s, the Ministry of Defence has complied with less than one-third of Public Accounts Committee directives. This systemic laxity gives Bahria Foundation near-total freedom to expand unchecked. As one Islamabad-based economist observed, “When institutions know they will never be audited properly, the incentive is to grow without limits.”
Strategic Costs to the Navy
Beyond the moral and economic critique lies a deeper irony: the Navy itself is not flourishing. Pakistan’s operational fleet remains in dire straits. Reports indicate that only two submarines are reliably at sea, with maintenance backlogs crippling readiness. Training exercises have been cancelled, spare parts are delayed, and fuel shortages are chronic. Meanwhile, senior officers retire into plush boardroom posts at Bahria Foundation subsidiaries. The contrast is stark: ships lie idle in dockyards while resources are absorbed into welfare ventures and real estate schemes. For junior officers and sailors waiting years for promotions or living in substandard facilities, the sight of their former superiors drawing corporate salaries is a source of quiet resentment.
The risk is not merely reputational. When procurement decisions are influenced by the lure of post-retirement rewards, the ethos of service is eroded. National security itself can be compromised.
Gwadar: Privilege vs Protest
Nowhere is the tension clearer than in Gwadar. Lauded as the fulcrum of CPEC and Pakistan’s gateway to the Indian Ocean, the city has instead become a flashpoint of discontent. Residents protest against deep-sea trawlers that deplete fish stocks, demand water and power that never arrive, and resist the heavy militarisation of their town. Checkpoints choke daily life while naval housing schemes flourish.
The symbolism is cruel: fishermen pushed off their waters watch as naval officers market waterfront plots; students struggling to pay fees watch as subsidised officers’ enclaves sprout manicured lawns. The social licence for military-run enterprises is fast eroding.
A System Built on Silence
Bahria Foundation is not an isolated case. It is part of a larger military-business ecosystem—estimated to be worth as much as $100 billion—encompassing the Fauji, Shaheen, and Army Welfare trusts. What makes the naval case particularly stark is the gap between rhetoric and reality. Welfare is the banner, but empire is the reality. Service is the language, but privilege is the practice.
Until there is civilian oversight, transparent auditing, and a levelling of the commercial playing field, Bahria Foundation will remain a symbol of Pakistan’s dual economy: one afloat on privilege, the other sinking in scarcity.
Pakistan’s leaders frequently tell their people that subsidies for food, fuel, and power must be cut under IMF diktats. Ordinary citizens are asked to “tighten their belts” in the name of national survival. Yet the state continues to subsidise privilege for its military elite, offering tax havens, subsidised land, and guaranteed corporate posts.
The question is no longer whether this system serves the welfare of veterans. It does not. Instead, it serves a narrow elite who glide seamlessly from the bridge of a ship to the boardroom of a conglomerate. The irony is unavoidable: a Navy tasked with defending sovereignty has become the custodian of privilege, undermining both the economy it claims to protect and the institution it represents. Unless confronted, this parallel empire will continue to corrode Pakistan’s institutions from within.
Ashish Singh is an award-winning senior journalist with over 18 years of experience in defence and strategic affairs.
