Pakistan’s Military and Institutions Deeply Entangled in Corruption, Report Reveals
Military at the Core of Systemic Corruption
Pakistan’s state institutions remain mired in corruption, with the military standing out as one of the most entrenched and least accountable power centers, according to a report cited on Wednesday.
The report describes the Pakistani military as “a corrupt institution protected by power, maintained through secrecy, and enabled by an absence of civilian oversight.” It argues that the military’s influence has not only shielded it from scrutiny but also allowed systemic rot to fester within the country’s governance framework.
Scandals Across Military Wings
Examples cited in the report highlight how various arms of the military were directly implicated in corruption scandals:
- Pakistan Air Force (Shaheen Foundation): Its joint venture with South Africa’s Hollard Group collapsed due to allegations of corruption.
- Pakistan Navy (Karachi Affair): Senior officers and political leaders were accused of receiving nearly €50 million in commissions.
- Fauji Foundation: The organization controversially sold the Khoski Sugar Mill in 2004 for PKR 300 million, despite a higher bid of PKR 387 million.
- National Logistics Corporation (NLC): Between 2004 and 2008, speculative investments led to a Rs 1.8 billion loss, with two army generals implicated.
Aid Suspended Over Rampant Mismanagement
In February 2025, more than $845 million in foreign aid meant for development projects was suspended after revelations of large-scale corruption and mismanagement. The United States Agency for International Development (USAID), a key donor, halted its funding after discovering that much of the aid never reached intended beneficiaries.
One of the most alarming cases involved the rise of so-called “ghost schools”—institutions existing only on paper. Corrupt officials allegedly used these schools to siphon millions in salaries and expenses meant for teachers and students.
Corruption Eroding Trust and Growth
The report highlights the dire global standing of Pakistan’s governance:
- 103rd in oversight
- 106th in government transparency
- 120th in controlling corruption
According to Transparency International, 35% of Pakistanis believe corruption worsened over the past year, while one in four citizens admitted to paying bribes for essential services. Corruption in law enforcement and judicial bodies has further eroded public trust in the justice system.
Strategic Liability in Global Markets
The report warns that corruption has become a “stranglehold” on Pakistan’s economy, crippling its industrial and innovation potential.
It cited a corruption risk index by TRACE and the RAND Corporation, where Pakistan ranked 173 out of 197 global markets.
For Pakistani businesses seeking to enter international markets, bribery is not just a domestic issue but a strategic liability. Payments to foreign officials risk violating international anti-bribery laws, undermining partnerships with Western firms, and reducing global competitiveness.
A Systemic Challenge
The report concludes that Pakistan’s corruption problem is not confined to isolated incidents but is deeply systemic, with the military at the center. Without meaningful reforms, oversight, and accountability, the country risks further isolation from foreign investment and aid, worsening its economic and political instability.