UAE stake in PIA deal puts spotlight on Fauji Foundation—the financial backbone of Pakistan Army

Soon after a consortium led by Karachi-based securities brokerage Arif Habib Limited (AHL) secured the bid for a 75 percent stake in Pakistan International Airlines (PIA) last week, Fauji Fertiliser Company Limited (FFC) joined the group. FFC, a military-owned but publicly listed firm, had itself been among four bidders for the same stake but withdrew just before bid submission and opening, Pakistan’s Dawn reported. The withdrawal was reportedly prompted by concerns that post-bid collaboration between two bidding consortia could be deemed collusive.

At the same time, as Pakistan grapples with mounting debt, Islamabad is allowing the United Arab Emirates to acquire a stake valued at around $1 billion in the Fauji Foundation—the Pakistan Army’s multi-billion-dollar conglomerate. Abu Dhabi is also expected to roll over loans worth approximately $2 billion.

So, what exactly is the Fauji Foundation? It is widely regarded as a vast profit-generating enterprise of Pakistan’s powerful military, with interests spanning nearly every lucrative sector of the economy—from breakfast cereals, fertilisers and cement to power generation, banking, real estate, stock investments and property development.

The Fauji Foundation forms a core pillar of Pakistan’s broader military–corporate complex, through which the armed forces control substantial economic assets and extend their influence far beyond defence into the civilian economy. It operates alongside the Navy’s Bahria Foundation and the Air Force’s Shaheen Foundation, both of which also run businesses across sectors such as insurance, shipping and real estate.

Another significant player is the Army Welfare Trust (AWT), which oversees more than two dozen commercial ventures. The Defence Housing Authority (DHA) further cements the military’s economic dominance, having turned the armed forces into Pakistan’s largest land developer, with projects spread nationwide.

Origins and growth

Established in 1952 as a charitable trust under the Charitable Endowments Act of 1889, the Fauji Foundation was initially created to support the welfare of armed forces personnel. It began with paid-up capital of $3.6 million, received from the British colonial administration to assist widows and families of World War II veterans.

By 2025, however, the foundation has evolved into Pakistan’s largest business group, with at least 25 listed and unlisted companies under its umbrella. While it officially claims that around 80 percent of profits are directed towards social welfare programmes, independent experts estimate the figure to be closer to 5 percent.

According to the Economic Policy & Business Development Think Tank’s Wealth Perception Index 2025, the Fauji Foundation ranks first among 20 public-listed conglomerates, with a net worth of $5.90 billion—making it the single largest commercial entity in Pakistan.

Its financial growth has been striking. Total assets rose from Rs 152 million in 1970 to Rs 2,060 million by 1982, before surging to Rs 495 billion (about $4 billion) by 2018. The jump to $5.9 billion in 2025 reflects a 78 percent increase in assets between 2011 and 2015, followed by continued expansion, according to Pakistani media.

Notably, while several Fauji subsidiaries are listed on the Karachi Stock Exchange, many others remain unlisted.

Business empire

Major revenue-generating subsidiaries include Fauji Fertiliser Company, Askari Bank and Mari Petroleum, alongside unlisted entities such as Fauji Meat Limited and Foundation Gas. In the energy sector, Foundation Wind Energy and FFC Energy Limited have expanded renewable capacity, while the Fauji Oil Terminal handles millions of tonnes annually.

The foundation also participates in strategic joint ventures, including Pakistan Maroc Phosphore in Morocco, and collaborates with global firms such as Cargill on marine terminals, The Times of Islamabad reported.

Its LPG marketing arm, Foundation Gas, held a 16 percent national market share as early as 2004, distributing more than 55,000 metric tonnes annually.

The Fauji Foundation is also deeply involved in projects linked to the China–Pakistan Economic Corridor (CPEC). Military-affiliated firms have secured major contracts, with Fauji Fertiliser Bin Qasim (FFBL) partnering Chinese companies in coal-based and LNG power projects. Other Fauji-linked firms are active in supply, transport and construction tied to CPEC developments.

Criticism and estimates

Ayesha Siddiqa, Pakistani military analyst and author of Military Inc: Inside Pakistan’s Military Economy, has argued that the country’s military “welfare foundations” collectively run thousands of businesses worth tens of billions of dollars, ranging from small petrol stations to large industrial plants.

In a 2008 interview with Al Jazeera, she estimated the military’s private wealth at around $20 billion—a rough figure split equally between land holdings and private military assets. She also suggested that the military controls about one-third of Pakistan’s heavy manufacturing sector and up to 7 percent of private assets.

Meanwhile, retired Indian Army officer Lt Gen A. B. Shivane, writing for the Indian Army think tank CLAWS, has alleged that the Fauji Foundation operates through an opaque network and is linked to money laundering and narco-terror financing. He claimed that Pakistan’s military controls roughly $50 billion of the country’s $400 billion economy.