Industrialisation flashback

The year 2022 celebrates commencement of commercial operations five decades ago at the Heavy Mechanical Complex (HMC), the pioneering capital goods industry, and once a flagship of Pakistan's engineering sector. The first unit of Static Road Roller of 10-12 tonnes capacity was rolled out the factory in March 1972, followed by production of another twelve road rollers for the Larkana Municipal Corporation, Sindh for which order was placed under the directive of President ZA Bhutto.

It was during the Bhutto period that HMC got breakthrough and was placed on sound footings for production of capital goods. He had also directed construction of a sugar mill at Larkana, Sindh for which HMC was to produce machinery and equipment based on the Chinese design and engineering. In later years, Prime Minister Bhutto had directed the Punjab Industrial Development Board (PIDB) to place order on the complex for two sugar mills to be installed in Punjab. These were constructed and commissioned based on the European technology and proved to be a precursor to developing domestic sugar industry.

That indeed was the golden era for HMC and for heavy engineering sector in general, which in subsequent years fostered the industrial and economic growth. Shah of Iran Reza Shah Pahlavi and Empress Farah Diba had visited HMC to whom overwhelming welcome was extended by Prime Minister Bhutto and Begum Nusrat Bhutto. Many other international celebrities and heads of foreign states came to the complex during the Bhutto period, whereas the illustrious ministers for production, JA Rahim and Rafi Raza, and other cabinet ministers frequented the factory premises.

The foundry and forge project of HMC was inaugurated by Prime Minister Bhutto. Chinese technical team stationed at Taxila was led by Mr Jiang Zemin who later became President of China. In later years, President Zia-ul-Haq visited the factory on a few occasions, as well as President Farooq Leghari. The presidents of Sri Lanka, Uganda and other countries visited the complex. Many industrialists would take pride in visiting HMC for placing orders personally for plant machinery required for their enterprises.

The complex, a strategic industrial unit, was established at Taxila, Punjab in late1960s/early 1970s as a project of the Pakistan Industrial Development Corporation (PIDC) with the objective to achieve self-reliance in the manufacturing of capital goods and to stimulate the process of industrialisation to which it has successfully and largely contributed. Within a short span of time, it emerged as the pioneering design, engineering and manufacturing concern and established itself as a leading supplier of complete sugar mill and cement plant of international standards. It has designed, manufactured, and installed more than 46 sugar mills and 22 cement plants of various capacities, and over 35,000 tonnes of equipment for power plants for various projects.

A host of other engineering goods manufactured by HMC include road construction machinery, industrial boilers, various types of cranes, railway equipment, truck chassis and axles, equipment for thermal and hydropower plants, fertiliser plants, chemical plants and oil refineries, and steel towers for transmission and distribution of high voltage electricity, besides a variety of steel structures, castings, forgings, spare parts, and components. The company earned significant profits, provided employment to thousands, trained hundreds of engineers and technicians, created strong auxiliary and vendor industries, and developed new products for strategic industries. In fact, it heralded a new era for the national industry. Nonetheless, the company has been through many highs and lows during past fifty years or so.

HMC, which was owned and operated by the State Engineering Corporation (SEC) till early 2000s, consists of two major industrial units, HMC-1 or Mechanical Works, and HFF or Foundry & Forge Works, now known as HMC-2 that was constructed in late 1970s. Heavy Mechanical Complex-3 (HMC-3), a heavy pressure vessel workshop adjacent to HMC, was established in 1992 as a joint venture between SEC and the Pakistan Atomic Energy Commission (PAEC), for the manufacturing of dedicated components for nuclear power plants.

The two complementary units, namely HMC-1 and HMC-2, were set up with the Chinese economic and technical assistance. The integrated production facilities at HMC include fabrication, machining and assembly, steel, cast iron and non-ferrous foundries, forging, heat treatment, surface treatment, galvanising, woodworking, dies and tool room, and other infrastructure, supported by comprehensive quality assurance and control systems.

Looking back, one reverentially remembers the founding engineers who dedicatedly and devotedly served the organisation. TA Hussain was the first head of HMC-1 during the construction phase, but Colonel Ishtiaq Aziz, later promoted as Brigadier while still with the complex on deputation, is known as the architect of HMC-1. He completed the project, with support of the Chinese working team, in record time, having started production of weapons in 1970-71 in the wake of looming war with India that later culminated in separation of East Pakistan. President Yahya Khan had inaugurated completion of project in November 1971. During this period, a variety of defence items were produced and supplied by HMC including mortars, rocket launchers and accessories for aircraft and jeep. At that time, Lt Gen (retired) Altaf Qadir, a well-read and enlightened person, was the Chief Martial Law Administrator at HMC-1.

During more than ten years of profound services to HMC-1, Brig Ishtiaq Aziz, an administrator and engineer of high calibre and a person of great personal qualities, had literally worked day and night to achieve the objectives. Even during adversity, he never wavered from principles, and steered the company in difficult times. He contributed immensely to develop capability of producing weapons at HMC-1. European technology for sugar mill was acquired during his tenure, which led the complex to transform it to a centre for design, engineering, and manufacturing of high-quality products of international standards. Creating a conducive environment for growth of human capital was a special feature of his administration.

Many engineers trained at HMC-1 during his period worked later at top and senior positions in public sector as well as in private companies, within the country as well as abroad. On his transfer to under-construction Pakistan Steel Mills at Karachi in 1976, KM Faruq of the corporation became the Chief Executive of HMC-1. Interestingly, after graduation in engineering he had passed the prestigious CSP examination with distinction, but he preferred to serve as a professional engineer, joining the Telephone Industries of Pakistan (TIP) and then SEC. He was a genius and visionary, who brought Pakistan on the world export map of plant machinery by securing orders for sugar mills from Indonesia and Bangladesh that shaped the future of HMC-1 through ages. The first-ever computer in a Pakistani company was installed at HMC-1 during this period.

Robust policies for sales and marketing were adapted, and long-term planning was chartered based on innovation, quality, and reliability of products. Technology would be forthcoming from Australia, Poland, Italy, the UK, Germany, Japan, and other sources, besides the Chinese, for its product mix. Acquisition and assimilation of know-how had been successfully done, through technology transfer agreements and under joint ventures with foreign companies. This enabled HMC-1 to become market leader in supply of sugar mills and cement plants on turn-key basis.

Brig Ishtiaq Aziz and KM Faruq were truly the symbols of devotion and dedication. Today they are forgotten heroes, sadly, but remain mentor and role model to many. Alas, KM Faruq was removed unceremoniously when HMC was on its highest ebb as a cause of conspiracy hatched by an opportunist design manager of the company who maneuverer to take CEO’s position in a sudden and appalling move. Unfortunately, the dejected and disheartened Faruq could not survive the shock and expired within few months due to cardiac failure.

Meanwhile, HMC-1 had booked various orders for the machinery of sugar mills as the government encouraged investment in this sector providing liberal financing. However, the changing of guard brought darkest times for the company as it was grossly mismanaged, and corruption and malpractices were the norms of the day. Many honest and frustrated engineers left HMC-1, who were replaced by mediocre and hand-picked cronies. The financial irregularities came to light only when the managing director was transferred to another SEC company. A retired air marshal was brought in his place by SEC, as an interim arrangement; such was the clout created by his predecessor’s political and bureaucratic connections to retain his position. Later, the Corporation officials, Mahboob-ul Hasan, and the writer, were appointed the CEO, before HMC-2 merger with it in 1988, and the company was back in profits.

HMC-2, which for some time was also known as HFF Engineering Ltd, has its own history. The company commenced commercial production in June 1978 and supplied heavy castings and forgings to HMC-1. Annual capacity of plant is 60,000 tonnes of various products, but it could hardly achieve 30 percent capacity utilisation in any year of production, as it depended solely on HMC-1 business, and failed to develop market and to diversify the products. The company suffered huge losses. At some stage, it planned to manufacture mini cement plant and brick-making plant, in collaboration with the British and the Yugoslav companies, respectively. But no orders could be secured for these products as it was not supported with a business plan and marketing efforts.

At this juncture, it is pertinent to mention that metallurgical engineering is the backbone of engineering industry and requires experienced metallurgical and mechanical engineers for assimilation of technology and developing skills. Unfortunately, head of company for long time was a civil engineer. A PhD in civil engineering, without any experience or training in any discipline whatsoever, was directly appointed as a chief engineer in 1968 to coordinate with the Chinese team for project construction. He however soon manipulated to acquire position of head of project, to be the CEO later, in an unfair manner replacing an experienced metallurgical engineer of PIDC.

Thus, foundation of HMC-2 was poorly laid. The CEO somehow managed to keep this unit as a separate company, which was planned as an integrated facility for HMC-1 to meet his self-interests. Not only that, he would humiliate senior engineers working there, and any competent engineer was discouraged to stay, perhaps because of his complexes and insecurity concerns. Many examples could be quoted. A PhD in metallurgy from the USA with industrial experience joined the company in 1980 but left within few months in frustration. Ironically, he was class-fellow of the CEO but was given a position four steps down.

Thus, mediocre professionals survived, which weakened the company’s commercial, human capital, and financial capacity. The CEO was transferred in 1981. For a short time, a retired vice admiral worked as the CEO, before Zafar Ali Khan, a UK-qualified chartered accountant with industrial experience, was given the charge, who rebuilt the organisation in real earnest. Later, HMC-2 was merged with HMC-1, and Zafar Ali Khan continued as the CEO of Heavy Mechanical Complex (HMC) until 1997.

HMC remained on the privatisation list for almost two decades, before a final decision was taken by the government to retain its ownership as a strategic unit.

The writer is former   Chairman of the State  Engineering Corporation