Daily Times

Keynesian prescriptions upended the laissez-faire model of Adam Smith through a benign governmental intervention for public weal. Scholars like Paul Samuelson later came up with “Theory of Public Good” wherein a public good was defined as something that all people could benefit from and enjoy without rivalry and exclusion. National security, air, rivers, and human security are those public goods whose non rivalrous and non- excludable nature makes those equally applicable to all without class, race, or any other distinction. Public welfare is also a public good that is germane to all classes and more so for those who were excluded from those goods due to economic exploitation or any other peculiar nature of their social status.

Provision of public goods therefore demands an economic theory lying in between the market entrepreneurship and welfare economics. The capitalist societies based on laissez-faire economics like the USA have social safety nets and insurance mechanisms to minister to the needs of deprived communities. The welfare states like UK, Nordic countries, and Canada rely on taxation for redistributive justice while the communist societies have based their whole political ideology on economic egalitarianism. That leaves the developing countries already on the dole of international economic institutions scurrying desultorily for economic solutions for endemic poverty and economic inequality. While the states fail in such countries to provide a viable model for public welfare for general populace, the responsibility devolves on niche players to cater to the welfare needs of their constituency. The militaries the world over have found solutions to the healthcare, education, and post retirement needs of their veterans it is only in Pakistan that a unique model has been successfully tested and applied.

The British Indian Army that along with British Navy laid the foundation of a global empire introduced the concept of providing public goods through an institutionalized system of welfare other than normal pensions for the war veterans of subcontinent in 1945 known as Post War Services Reconstruction Fund. At the time of partition (1947) when Pakistan came into being, the balance fund of 18.2 million rupees was transferred to Pakistan as per the proportion of its post WW-II veterans. Till 1953, the fund remained in the custody of the civilian Government while in 1954 it was transferred to the Army. Interestingly in India where the fund was distributed to the veterans no basis of a sustainable welfare organization was laid. Present Department of Ex Servicemen Welfare (DEWS) in India relies on periodic doles from Ministry of Defence and does not have an independent sustainable source of welfare spending for war veterans. In Pakistan however the story was different.

The Army instead of disbursing the balance fund of about Rs 18.2 million (USD 0.2 million) among the beneficiaries, established a foundation called “Fauji Foundation”, under a charitable trust, and invested the money in establishing a Textile Mill. Later from the income of the textile mill, it established first 50 bedded TB hospital at Rawalpindi.

On the industrial front Fauji Foundation has successfully developed the industrial potential of fertilizer and Oil & Gas sector that lay in a state of dormancy after the nationalization experience that had drained the élan vital of organizations such as Mari Gas

Fauji foundation is proud that from Rs 18.2 million in 1953, it today runs more than 18 industries, the income from which is utilized to serve about 9 million beneficiaries (five percent of country’s population). Generally, more than 80 percent of the income goes towards the welfare activities every year. The welfare is conducted through health care, education and vocational/technical training. To a limited extent welfare is also a by- product of employment generated for the beneficiaries through commercial and welfare activities. Presently, the welfare is conducted through 115 medical facilities, 104 Schools & Colleges, 66 Vocational Training Centres and 10 Technical Training Centres. 58 percent of the welfare budget is spent on healthcare. The 50 bedded hospital has blossomed into a state of the art 750 bedded hospital with the Fauji Foundation Health Care System today being the largest medical chain outside the Government sector, spread all over Pakistan.

In order to provide best medical treatment and care to the beneficiaries all the FF Medical Projects are equipped with most sophisticated and modern equipment to achieve best diagnostic facilities. The Artificial Limbs Centre of Fauji Foundation at Rawalpindi is also the largest centre of its kind in the country. On an average it provides over 7,000 artificial limbs and supporting appliances every year, approximately one-third of which go to non-Beneficiaries on subsidized cost. Ex-servicemen, their families, and those eligible for zakat, get them free of cost. Since 1966, when this centre came under Fauji Foundation, it has provided 2,34,201 artificial limbs and related appliances to patients, besides having done repair work on another 93,911.After the earthquake of 8th October, 2005, the Artificial Limbs Centre played a major role in the provision of prostheses and orthoses to the injured. By fitting 259 prostheses and orthoses, it made the largest single contribution to this effort. In collaboration with the ICRC (the International Committee of the Red Cross), it carried out a reach-out programme at Muzafarabad, Azad Jamu & Kashmir by providing artificial limbs and supporting appliances.

The organization is rendering a yeoman’s service in the cause of education all over the country. Its presence in all provinces and in far flung areas promotes the cause of national integration too besides taking care of the educational needs of families of the military veterans. With over 104 branches spread from Karachi to Gilgit having 48399 students and 2118 teachers, Fauji Foundation’s educational system is one of the largest educational systems in the country. The technical and vocational educational regime of the foundation is based on courses that equip the graduates to find gainful employment based on the skills imparted. Viewing the need for skilled manpower the foundation is in the process of revamping its entire technical education system with diploma and BE Tech degree programs in the vanguard. The academia-industry interface is also promoted through an active regimen of industry sponsored research, wherein our 18 industrial units provide research and industrial development support to the graduate and post graduate level students of technical departments of reputed universities such as NUST and COMSAT.

On the industrial front Fauji Foundation has successfully developed the industrial potential of fertilizer and Oil & Gas sector that lay in a state of dormancy after the nationalization experience that had drained the élan vital of organizations such as Mari Gas. Now under Fauji Group Mari Petroleum (MPCL) with 18 percent market share is the second largest gas producer in the Country with cumulative daily production of 100,000 barrels of oil equivalent. The company’s exploration and production assets are spread across all the four provinces of Pakistan. The company enjoys the highest exploration success rate of 70 percent, much higher than industry average of 33 percent (national) and 14 percent (international). At the same time, it is the most cost efficient E&P Company in the country with lowest operational cost of only 10 percent of the gross sales. Fauji Fertilizer Company Limited is the market leader in urea along with DAP producing FFBL. Together these two companies provide the bulk of fertilizer products to the farmers besides contributing to the research and development in yield enhancing varieties contributing to food security of the country.

Fauji Group was the pioneer in the Wind Energy projects in the country establishing three 50 megawatts wind energy farms at Gharo and Jhimpir. The successful commissioning of the three farms acted as the spur to the renewable energy industry of the country showing the way forward towards energy security without reliance on imported fuel sources. The cement sector also benefitted from the disciplined commitment to industrial excellence of Fauji Group with Fauji and Askari cements now a byword of excellence and economy in the infrastructure sector. Straddling a wide gamut of industrial sectors like Grain & Oil terminals, banking, food, cement, thermal IPPs, Wind Energy IPPS, Liquefied Petroleum Gas, Oil & Gas exploration, and fertilizer manufacturing, Fauji Group’s industrial projects led by competent teams of domain experts, feed its welfare arm’s appetite in a unique symbiosis of industry and welfare. The uniqueness of this whole enterprise lies in the use of ninety percent of its profit on welfare after paying nearly 180 billion annual taxes to the government. This might be the only enterprise of its kind in the world and is therefore a fit example for case study by best business institutions of the world.

The above story of business and welfare is worth emulating by other niche players motivated by the desire to make difference in the lives of impoverished and deserving segments of populace. For a country famished of a welfare net, for want of good governance since ages, this might be the model that makes the ultimate difference.

The writer is a PhD scholar at NUST; rwjanj@hotmail.com

Published in Daily Times, December 31^st 2018.