Impact Of Nationalization On BECO And Pakistan Economic Development

There had been many times in Pakistan’s history when stupid decisions were taken by the government. Nationalization in Bhutto’s era was one of those decisions. 22 Families lost everything that they had worked  for all their lives. BECO (Batala Engineering Company) is one such example.

Late Chaudhry Mohammad Latif was the founder and chairman of the Batala Engineering Company (BECO). After attending a meeting of leading Muslims in Batala, who wanted to establish Muslim industries in the face of Hindu dominance of retail, that he struck upon the idea of forming BECO.The company was established in 1932. , He sold its first 10 shares to a lime merchant for Rs 10. In the early years, he worked almost single-handedly to build up the company from its first workshop in two rooms and a veranda. Over the course of the next forty years, and in spite of losing much of his business when he migrated to Pakistan at Partition, he built BECO into a stalwart of the engineering industry in Pakistan. when the migration took place and all the muslims came to Pakistan. BECO donated a very large amount of its money to the govt of  Pakistan, so the institutions could start functioning.

At its peak BECO employed 6,000 workers producing tools and engines that drove forward Pakistan’s fledgling economy. A model of Pakistani industry and the pride of Pakistan, BECO was a regular stop by visiting foreign dignitaries

Board of Directors (Lto R)

Chaudry Abdul Karim, Arif Latif, CM Latif, Khan Abdul Rehman , HMS Chaudri

Visit by Chinese Prime minister Chou En Lai. He was so impressed by BECO that he vowed to send Chinese engineers there for training.

Visit by Syrian Head Of State

King of Thailand on a visit to BECO during his state visit to Pakistan. Mr. Latif showing him a diesel engine coupled with pump. In those days all visiting head of states were shown BECO as a national asset

Mr. Latif with his team showing slow speed diesel engine parts to visiting dignitries. A lot of these were sent to East Pakistan to drain out water and produce power.
In background is Mr. Schneider BECO’s German works manager and Chief Engineer.

Mr. Latif with visiting KSB pumps director from Germany. BECO produced pumps in collaboration with KSB pumps with Siemens electrical motors in the BECO Kot Lakhpat factory

Visit by Pakistan’s Prime Minister

Being an Engineer Mr. Latif always believed in making progress in development of ideas and technology. In an interview couple of years back he said “I believe in creating money and not in making money.” “We can create money by employing more people and by expanding our business. Money, as such, should have no attraction for any reasonable person. What should really move us is the task of adding to our national wealth.”

Mr. Latif was a man of great genius and dedication . He brought BECO to teh heights of glory. Beco was ahead of its time in terms of technology.

Concrete Mixers

With his team of Japanese engineers

Machine tool division with lathe machines.

Testing the gates for barrages and canals

Machine tools division.

Zulfikar Ali Bhutto took over power on December 21, 1971 and on January 1, 1972 his government promulgated the Nationalization and Economic Reforms Order nationalizing 31 key industrial units, completely wiping out BECO. The company’s name was changed to PECO (Pakistan Engineering Company). Like other nationalised companies, PECO did not cut it and by 1998, it had run up an acknowledged accumulated loss of Rs 761.58 billion. In October 1977, Gen Zia-ul-Haq offered to return control of the company to Mr Latif and his management. Mr Latif refused to accept the offer unless the same were extended to owners of all nationalised industries.

It is such a sad thing that in the name of the country Mr.Bhutto ruined what was something to be proud of as a Pakistani. Had BECO remained with its owners we would have put Tata and Birla to shame. Govt abandoned the factory, sold out tons and tons of steel in the building structer and , and now what is left of it ,is an Industrial graveyard.

abandoned halls in the office at the Badami Bagh location

The desolate time office crumbling with time surround by acres of nothingness. At one point it was responsible for a factory chock a block full of sheds. There was no space to move without encountering a crane, machines, raw materials, spare parts and 3000 workers.

Every single shed was taken apart and all steel used in its construction was sold off made money pocketed. The glorious days pictures show the strength and amount of steel used in the sheds. Thats a gigantic amount of cash ……..

The office at the Badami Bag factory……the only remaining building at the 52 acre unit that was completely covered in production sheds. Wondering why this was also not pulled down. Perhaps not enough steel in the construction to sell

graves haunted by spirits of diesel pumps, machine tools, textile power looms, concrete mixer, diesel engines………………………….

This room was filled with drawing boards jammed next to each other. A place of engineering creativity which now lies in ruin.

If a pillar has huge steel poles then its no surprise the sheds were demolished, scrapped and sold

Foundations of the factory under the grave like mounds………a true industrial graveyard where hope for Pakistan has been buried by greed of political leaders and bureaucrats.

A true industrial graveyard……….. When successive governments failed to run the company the Badami Bagh factory was demolished to the ground. Surprise surprise the aim was to plot it and make into a housing scheme……The family now has a stay order on this, but they often wonder what good is it when everything has been destroyed

As Mr. dadbuoy said in an interview to a loacal newspaper

” Had we gone at the rate of growth during the decade of 1960’s, I reckon we would have definitely been an Asian tiger by now”

Special thanks to Mahbina Waheed for sharing such historical pictures.

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43 Responses to Impact Of Nationalization On BECO And Pakistan Economic Development

  1. Ayesha says:

    Impressed by the effort and saddened that the family had to go through so much by letting go off something so great.

  2. Amjad Shah says:

    All these people who left after the nationalization. where are they now. what is Mr. Latif’s family doing?

  3. hussain says:

    Bhutto could be good at talking or convincing ….. he could be the greastest orator ever. but the fact of the matter is that he was a greeedy person, who was in power for his personal gains. he had nothing to do with the national development.

  4. M. Tafazzal-e-Hasnain Khan says:

    Very nice and thought provoking article. I once wrote a short article (link attached) on a Pakistani Car in a forum in whchi I mentioned the sad incident of BECO becoming PECO, but I did not know the full details at that time. Thanks a lot for enlightening me.
    Dr. Sufi M Tafazal-e-Hasnain Khan

  5. very good stuff. keep posting like it.

  6. M.Imran Ayub says:

    i guess we are going to face more trouble this time by the PPP, i never understand that who are the people that want them in power. This time around they have come with a PRE-NRO and lets see what mess they leave.

    the shame full part is that India and our neighbors china, iran etc are doing great.

  7. you have to give more information

  8. Hamid Ch says:

    I am weeping through the core of my heart. As a child I saw this factory on its peak. I rode its bicycle. The add on radio used to be,”BECO CYCLE KO CHALA KAR DEKH LO. HAR TARAH SAY AZMA KA DEKH LO”
    I remember it was one the great bikes made in My Pakistan. Why all this happened. Why the public did not agitate on that. its a big ?? mark. The nation which don’t have the feeling of pinch is dead. I pinched the dead body of my father to know whether he is dead or alive, there was no movement, I considered it that he was dead. So I prepared for his burial. Same thing happened with My Pakistan in 1971,when enemy pinched it, feeling no movement in the body, it took half the portion of that dead body. The half portion of My Pakistan’s dead body is waiting for burial. Yes at time I feel their is some sensation in its body. A good surgeon is required to treat it. Let us hope a surgeon like CA Latif is born to heel this apparent dead body.

  9. Playboy says:

    Latif’s family doing?

  10. Anwar says:

    Bhutto was a power hungry Machiavellian bastard. He violated the trust of people and messed the country up. A short sighted person trying to become Chu En Li of China while playing games of Napoleon… Was his father any different or his daughter?

  11. Usman Malik says:

    Another of the many sad tales of my country Pakistan!

  12. thegoriwife says:

    Wow, those old pictures are so cool to see, though.

  13. Hassan naqvi says:

    As an engineer, I feel so pity after watching the pics posted above.
    It irritates me when I compare the industrialization standards, the world is adopting, and our current conditions of Industry.
    We have the human resource to revolutionize the industry but only if we’re sincere for doing so ..

    Great job.

  14. Engr. MN says:

    Em Electrical Engr.. working in PECO KotLakhpat…

    all due to the Bhutto’s Nationalization Policy….
    worker unions… strikes for bonus..
    labour became permanent.. n they left to hardwork…

    badamibagh peco u can see in these pics..
    kotlakhpat peco is not different from it..
    private board of director is again rehabilitating PECO Kotlakhpat…
    last year PECO made sale of 150 million rupees
    n gave 4 bonuses to all employees.. Masha Allah…

    PECO is now making Telecom/transmission line towers, Pumps n motors.. and Peco Foundry has again been started..
    May Allah bless PECO..

  15. Crédit Direct : de l’argent liquide immédiatement. 10’000 fr. coûtent 60 fr. par mois !

  16. mobeenn says:

    It’s rediculas! Leaders supposed to be misleaders!
    Pity on poor nation! Without industrial growth economic growth is impssible!

    Mubeen Nisar

  17. Nasir, Khi says:

    Democracy is the best revenge… (majority is authority) Bhutto, his allies in PPP & foolish voters who voted for his premiership in 70’s, voted for Benazir & recently for Zardari are responsible for this constant looting & cheating in day light. Unfortunately, their followers are large in numbers & for people like us it is difficult & challenging to bring justice & recover the loss recurring for almost 40 years now.
    Nationalization was meant for recruiting PPP ‘Jialas’ in the nationalized industries to finance their needs, stopping Pakistan from progressing, demoralizing investors (22 families & new comers in future). If there was a problem in labour law, Bhutto should have rationalized the Law to bring balance. This injustice will continue till the time our nation stays away from education & PPP is all set against educating the common people.
    Mr. Bhutto does have few good deeds to his credit, but the seed of nationalization has damaged Pakistan & its people at large. He was a great politician but not a nationalist, if he was so, he should have refrained from nationalization. He should have nationalized the “Jagirdari System’ first to show his honesty but how could he do that??? because as a result, he would be the 1st looser of large agricultural land of his own & his allies. Charity begins at home & Bhutto consciously refrained from doing so.

  18. Nasir, Khi says:

    I salute these 22 families & all small & medium entrepreneurs who have made great contributions in developing Pakistan. The fruits we are enjoying are a result of their deep rooted plantation & cultivation. Allah bless them in this world & hereafter, Ameen
    May Allah also give us courage to get rid of such Democracy & democratic bandits who are ruling Pakistan but have dual nationalities & no stakes in Pakistan. Allah will never change our fate until we take the first step.

  19. mazhar khan says:

    ALLAH jiss se chahe izzat deta aur jis se chahe zillat deta hai!!!!!!
    “Wa tu izzo mantasha o wa tu zillo mantasha “Allah honors those He is pleased with and disgraces those He is not happy with” The Holy Quran.
    pakistan ke liye sirf aur sirf zillat hai -word by an indian muslim

  20. Mohammed Sajjad says:

    The term “Nationalise” means – To Nationalise Foreign Owned Industry and Business that was taking away national wealth in the shape of Profits to a foreign country.
    The first weapon that the Colonials used against the colonies were these foreign owned businesses.
    In our case it was the “East India Company”. All “Foreign Investment” and businesses that came to the Indian Sub-continent had only one aim and that was to exploit our resources and take the Profits back to England etc. National and Grindlays Bank, Lever Brothers etc were the flagship businesses of the colonials.
    Today, these businesses are known as “Multi National Companies”.
    Pakistan is the ONLY country in the world where National Companies and Businesses were “Nationalised” and foreign companies continued to flourish.
    Bhutto’s nationalisation policy was nothing but a policy based on ego and revenge against the business class for not supporting his PPP in the late 60’s. The second reason for this policy was to make sure that NO OPPOSITION or “Opposing Finance” remains.
    BECO was a “National Treasure” and to this day I feel pain and anger at what was done to these national assets. Even today after 41 years, a BECO Lathe Machine is a prized possession.
    Engineering Industry, Banks, Oil and Gas, Edible Oil, Cotton, Cement, Automotive Industry, Chemical Industry, etc were destroyed and these assests were sold off for scrap.
    But the saddest and worst national destruction took place un-seen, the 70’s were supposed to be the “Spring Board” years for Pakistan’s Future and Economy because Rupees.4 = $1.
    The cost of new industries was; Hydro Cracker Industry $50 million, Oil Refinery $35 million, Fertilizer $30 million, Textile $1.5 million.
    In five years the value of the Pak Rupee depreciated 2.5 Times i.e from Rs.4 = $1 went down to Rs10 = $1. At the same time the Indians went on Industrialising and Expanding.
    How can we ever regain our loss?
    Especially, when . . . . .
    We still hear “Jeeay Bhutto!”

  21. ANWAR ahmed says:

    I was studying in The University of Technology Loughborough U.K where we were given practical training on Lathes and Milling machines. It was such a pleasent surprise and a matter of pride to see the logo of BECO of the machines.Our instuctor informed the students that no one has been able to make better lathes than BECO. He further said that even Switzerland impots and uses BECO lathes in spite of a well known fact of Switzeland being a leader in precision tools and machines. This year 1953.What a tragedy and an act of treason to destroy BECO and many other industries under the garb of nationalisation.

  22. Syed W. Hussain says:

    The fact to remember is a simple one. Mr. Latif started this organization in his house in 1 room and a veranda. Which proves, it does not take much to get an enterprise going. The
    saying “When there is a will there is a way” works here. Why our young men standing in the
    side lines and sighing after reading about the glory of BECO. Why dont they band together and start enterprises that can equal BECO’s success and protect it from poor decision makers. People have to take matters in their own hand. A creative thought instead of a sigh
    goes a long way.

  23. Mehmood Z.Motiwala says:

    Z.A.Bhutto was a fucking idiot !! The ‘nationalization’ was a ploy to get even with the industrialists who used to snub him at the Sind Club bar. Sindhis cannot hold their drink like civilized folks.

  24. sohai osman ali says:

    thank you for posting the detail story, made more powerful with the photographs. Scandalous, how BECO ended. What a great man Mr. C.M. Latif was, a shame how his efforts ended.

  25. Zubair says:

    What can I say. We are still all out to vote for the same people who destroyed and broke the country. His party and his family is at it even after his death——and we are responsible for it. Long live democracy.

  26. Zafar Iqbal Chaudhry says:

    it was a tragedy of immense proportions.

  27. Samina latif says:

    Hi everyone. I believe who ever wants to read the history of beco industries, go to website

  28. Ahmed says:

    Sad Sad Sad.

  29. Pervez A. mahmud says:

    “Foundry is the mother of all industries and Pakistan needs this industry to flourish.” “It is also the toughest and the dirtiest job in the world.” These were the words of George, my father’s friend and an American industrial advisor working in US AID in 1967, Lahore, Pakistan. I took his advise and decided to start my career in foundry. I was convinced that working in this field I will help built Pakistan industry. I got initial training from PITAC, Lahore, and got a job in a reputed foundry. There I met with hard working and talented Pakistanis. I salute them. There I saw this enthusiasm of doing some thing for the country. In those days, Pakistan was spending millions of dollars in importing Grinding Media, metallic cylinders and various size metallic balls that were used in grinding lime stone to make cement. These people were able to accomplish that goal, and we stopped importing the grinding media from Russia and Turkey. The whole idea of giving this detail is to appreciate the work of those people who not only make their own living but also help country save the foreign exchange. To nationalize these industries, you are removing the motivation an industrialist has to built his country stronger and save foreign exchange. My heart was bleeding and my eyes were continuously becoming wet as I was reading this BECO article. Today is August 14, 2014, and on and off I am watching TV news via satellite dish about Pakistan regarding Azaadi march and Long march, and a possibility of violent clashes between political parties and government machinery. Although I live in Long Island, New York, and I am a US citizen, a retired man and have not visited Pakistan since 1988, my heart still beats for Pakistan. All I wanted to say to my fellow Pakistanis, let’s not be numb any more. Wake up and look around, world has moved ahead of us. We must unite move forward as soon as possible. God bless Pakistan.

  30. Shahzad says:

    Certainly you made a great effort and reconciling all details in your report. There are few things that I would like to share with you guys

    Three Bros M. Sharif, C.M.Latif and H.M.Sadiq choudri.

    C.M.Latif died years ago in Paris. His kids (Sons and Daughter’s) are in Lahore and still living in their father’s home i.e. on Kashmir Road.

    M. Sharif Died in 1972 and his family (Son) living in same home i.e. in Cantt. Daughters in their husband’s home.

    H.M.Sadiq died and his sons living in Karachi….

  31. Anika Khan says:

    I know, C.M.Latif’s grand daughter is my friend.

    Didn’t know about others though. Thanks Alot.

  32. Shahzad says:

    Your welcome :).. I guess granddaughter lives in uk?

  33. aliya says:

    itss a painful realty we hvnt any othr mill like BECO i ws unaware abt the historyy of BECO. mostlyy of us evn nw sayss kl b bhto zinda tha aj b bbhuto zinda h..i wish he hvntt take birth in ds countryy

  34. Sajjad Habibullah says:

    Absolutely true and I agree with your thoughts and sentiments about nationalization and the waste of incredible talent in Pakistan’s engineering industry.
    Irreplaceable investments and opportunities were lost.
    The worst being the Dollar value or buying power of the Rupee in the late 60’s and early 70’s.
    The damage done by the “socialist” thought on the minds and social fabric and the loss of investments were worse than an invasion by our worst enemy.
    The name “Bhutto” turned into a curse.
    “Roti, Kapra aur Makaan” was never provided and there was no intention to provide.
    The people responded to a call that was Pharonic (Fironee). Therefore the curse.

  35. Shahzad says:

    aahan, if you want to read book BECO Family i have it in pdf format….

  36. Shahryar says:

    My father retired from PECO after working 40 years in mid 90,s. He worked on lathe, grinding machines. I remember from his pay envelop that he worked in the slow speed Diesel engine shop in Badami Bagh. I used to get PECO bicycle each year. He has told us so many good stories about the company, German engineers, labor unions, Saban Saab. CM Latif,s daughter was marketing manager and she was married to Ch Waheed, an ambassador. German engineer offered job to my father in Germany. But he refused because my grandmother did not give him the permission. He spoke very highly about German engineers and praise a great deal about their hospitality. KSB Pump was a German design. But it was built in BECO through JV. According to him, CM Latif told Zia that he need x amount of rupees (in billions) and will replace the whole top management. I totally agree. But it did not work out with the government. Imagine, the bearucrates were in charge after nationalization, who cannot run a small shop in real life. Nationalization was a giant mistake, which killed the private investment for industry. Our leading industry is now housing schemes, plazas etc Feel so sad. Our manufacturing base is limited because the growth for private industry extremely slow down due to nationalization in 70’s.
    If BECO had flourished, we would have been able to make Diesel engine, which is used for buses, trucks, off highway applications such as construction machinery, mining machines, generators. It is sad that we don’t have any Diesel engine manufacturer in Pakistan. I feel sad when I see Bedford truck moving at 15 mph, which are highly fuel inefficient due to being overage, old technology.
    My father had same feelings as shared by this article. I am going to show him these pictures when he visit me this week in Boston. My father has earned his living by working in this company and my family is so thankful. It was a great company, which had all potential to excel in engineering technology, would have contributed to national economy and set example for other private industries. But we stop the wheel of industrial growth by nationalizing the private industries.

  37. Masood says:

    CM Latif is a great inspiration for all of us to move forward & Bhutto is a great lesson of history to keep us awake & vigilant for the future.Instead of lamenting on what Bhutto did, we need to change the mind set of our society who supports such characters like Bhutto.

  38. Ikhlaq says:

    Nationalisation in 1973 was the so called constitutional dacoiitee on some ones personal propertry.

  39. Pingback: Mian Sahib of another kind – Zaheer Anwar

  40. Ali Raza says:

    May Allah punish the Bhutto family for destroying our nation’s future.

  41. higgsbosan says:

    Reblogged this on HiggsBosan Blog and commented:
    Thanks. What a tragedy & what a stupid act by ZBhutto …

  42. higgsbosan says:

    Thanks for writing this. This tragic ghastly act by ZBhutto to ruin a rising essential Industry. Best wishes. I just tweeted it. Same happened to Ittefaq …

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