subject: Pakistani Defense Sector - Market Opportunities And Entry Strategies, Analyses And Forecasts To 2015 [print this page] Summary Summary
This report offers insights into the market opportunities and entry strategies adopted by foreign OEMs
(original equipment manufacturers) to gain a market share in the Pakistani defense industry. In
particular, it offers in-depth analysis of the following:
Market opportunity and attractiveness: detailed analysis of the current industry size and
growth expectations during 20102015, including highlights of the key growth stimulators. It also
benchmarks the industry against key global markets and provides detailed understanding of
emerging opportunities in specific areas.
Procurement dynamics: trend analysis of imports and exports, together with its implications and impact on the Pakistani defense industry.
Industry structure: five forces analysis to identify various power centers in the industry and how these are likely to develop in the future.
Market entry strategy: analysis of possible ways to enter the market, together with detailed descriptions of how existing players have entered the market, including key contracts, alliances, and strategic initiatives.
Competitive landscape and strategic insights: analysis of competitive landscape of the defense industry in Pakistan. It provides an overview of key defense companies (both domestic and foreign), together with insights such as key alliances, strategic initiatives, and a brief financial analysis.
Business environment and country risk: a range of drivers at country level, assessing business environment and country risk. It covers historical and forecast values for a range of indicators, evaluating business confidence, economic performance, infrastructure quality and
availability, labor force, demographics, and political and social risk.
Scope
analysis of Defense industry market size from 2004 through 2009 and forecasts till 2015
analysis of defense budget allocation
Benchmarking with key global markets
Market opportunities
Defense procurement dynamics
Industry dynamics
Market entry strategy
Competitive landscape and strategic insights
Business environment and country risk
Reasons To Buy
Gain insight into Pakistani defense industry with current, historic and forecast market values
Get insight on market opportunity and attractiveness
Get insight on industry procurement dynamics
Gain insight on industry structure
Gain insight into the regulations governing the Pakistani defense industry and the potential market entry strategies with an expert analysis of the competitive structure
Identify top companies of the Pakistani defense industry along with profiles of all those companies
Key Highlights
The Pakistani defense industry, which valued US$6.3 billion in 2009, is expected to grow at a CAGR of 10.26% over the forecast period, to reach a value of US$10.4 billion by 2015. Indeed, the increased internal instability of the country following the onset of its participation in the international military campaign against terrorism, which is widely referred to as the war on terror, will continue to drive Pakistani defense expenditure during the next five years; while its long-standing territorial dispute with neighboring India means that the Pakistani defense strategy will largely correspond with the Indian spending and development program. Furthermore, Pakistan is expected to allocate 3% of its GDP for defense during the forecast period, despite its relatively small economy. However, while the country received an additional US$7.6 billion of military aid from the US for its contributions towards the war on terror during the review period, it is expected to receive aid of US$9 billion during the forecast period.
Moreover, Pakistan has been subjected to more than 5,000 terrorist attacks in the past five years, which have not only resulted in the death of many civilians, but have also adversely affected the economy, as several foreign companies have close operations within the country and new ones are reluctant to establish new business in the country. Consequently, the US has established a Pakistan counter-insurgency fund, worth US$1.2 billion annually (from 2011 onwards, currently it is US$700 million), to provide the Pakistani Armed Forces (PAF) with counter-insurgency training and related defense systems.
Keywords
Defense, Pakistan, Boeing, Howaldtswerke-Deutsche Werft, Raytheon, Lockheed Martin, Karachi Shipyard & Engineering Works, National Defense Complex, National Engineering and Scientific Commission, Pakistan Aeronautical Complex, Pakistan Ordnance Factories, Military Vehicle Research & Development Establishment, National Radio Telecommunication Corporation, Pakistan Space and Upper Atmosphere Research Commission, Air Weapons Complex, Daudsons Armory, Directorate General Munitions Production (DGMP), Heavy Industries Taxila, The Heavy Mechanical Complex, SATUMA, , , , , , , , , ,
Table of Contents :
1 Introduction
1.1 About this Report
1.2 Definitions
1.3 Methodology
1.3.1 Secondary research
1.3.2 Primary research
1.3.3 Conventions
1.4 ICD Research Terrorism Index
1.5 About ICD Research Defense Intelligence Center
2 Executive Summary
3 Market Attractiveness and Emerging Opportunities
3.1 Defense Market Size and Forecast
3.1.1 Pakistani annual defense expenditure to reach US$10.4 billion by 2015
3.1.2 Hostile neighborhood, internal instability and the war on terror expected to drive defense expenditure
3.2 Analysis of Defense Budget Allocation
3.2.1 Capital expenditure share expected to be maintained at an average of 28% during the forecast period
3.2.2 Army receives the largest share of the defense budget to prevent internal instability
3.2.3 The countrys defense expenditure as a percentage of GDP declined over the review period
3.3 Homeland Security Market Size and Forecast
3.3.1 Pakistan is at a significant risk from external and internal threats
3.3.2 PCCF and PSS likely to drive homeland security expenditure
3.4 Benchmarking with Key Global Markets
3.4.1 Pakistani defense expenditure expected to increase at a CAGR of 10.26% during the forecast period
3.4.2 Pakistan ranks thirty sixth in global defense spend
3.4.3 Pakistans defense expenditure expected to reach 3% of GDP by 2015
3.4.4 Pakistan is one of the most terror prone countries in the world
3.5 Market Opportunities: Key Trends and Growth Stimulators
3.5.1 Indigenous submarine development set to drive naval defense procurements
3.5.2 Development of indigenous UAV and aerial refueling aircraft, and refurbishment of existing systems expected to drive air force defense procurement
3.5.3 Demand for various types of helicopters to increase to counter terrorism
4 Defense Procurement Market Dynamics
4.1 Import Market Dynamics
4.1.1 Counterinsurgency and territorial dispute with India expected to increase defense imports
4.1.2 US and China were the leading suppliers of arms to Pakistan in the review period
4.2 Export Market Dynamics
4.2.1 DEPO expected to increase defense exports
5 Industry Dynamics
5.1 Five Forces Analysis
5.1.1 Bargaining power of supplier: low
5.1.2 Bargaining power of buyer: high
5.1.3 Barrier to entry: medium to high
5.1.4 Intensity of rivalry: low to medium
5.1.5 Threat of substitution: medium
6 Market Entry Strategy
6.1 Market Regulation
6.1.1 Defense procurements to follow the public procurement policy
6.2 Market Entry Route
6.2.1 Foreign firms enter the Pakistani defense industry through joint-ventures or government-to-government deals
6.3 Key Challenges
6.3.1 Bureaucracy and lack of transparency in Pakistani defense
6.3.2 Unstable political system coupled with internal instability discourages foreign participation
7 Competitive Landscape and Strategic Insights
7.1 Competitive Landscape Overview
7.1.1 Foreign suppliers manufacture defense systems overseas and deliver to Pakistan
7.1.2 Growing domestic defense sector is predominantly state run
7.2 Key Foreign Companies
7.2.1 Boeing: overview
7.2.2 Boeing: products and services
7.2.3 Boeing: recent announcements and strategic initiatives
7.2.4 Boeing: alliances
7.2.5 Boeing: recent contract wins
7.2.6 Boeing: financial analysis
7.2.7 Howaldtswerke-Deutsche Werft: overview
7.2.8 Howaldtswerke-Deutsche Werft: products and services
7.2.9 Howaldtswerke-Deutsche Werft: recent announcements and strategic initiatives
