Future of the Afghan Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023

Future of the Afghan Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023

  • July 2018 •
  • 89 pages •
  • Report ID: 2275848 •
  • Format: PDF
Future of the Afghan Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023

Summary
Afghanistan is emerging as one of the most interesting defense markets in Central and South Asia. The US invasion of Afghanistan after the September 2001 attacks led to the formation of a democratic government which is now putting focusing on the total revamp of its national infrastructure and defense industry. Its main objective is to have a strong, efficient and well-equipped armed force that can counter the Taliban insurgency and provide strong public security. These are the prime drivers of the Afghan government’s investment in the defense sector.

After the NATO-led International Security Assistance Force (ISAF) left the country in 2014, Afghan security forces were made responsible for protecting the country. Afghanistan’s total defense expenditure decreased at a CAGR of -1.78% during the historic period, from US$6.4 billion in 2014 to US$6 billion in 2018. Around 34% of the national budget was allocated to security expenditure in 2017, however, the negative CAGR was caused by a decrease in foreign aid which previously benefitted the security sector.

The withdrawal of the International Security Assistance Force (ISAF) from Afghanistan in 2014 necessitated the need for a strong and efficient Afghan National Defense Security Forces (ANDSF). As a result, the Afghan government is expected to assign an average of 3.7% of its GDP to defense purposes over 2019-2023. The county is expected to acquire defense equipment such as light fighter aircraft, attack helicopters, small arms and ammunitions, and armored vehicles over the forecast period. Instability within the country’s political scene, along with internal security threats emerging from the growing human trafficking and drug trade, is expected to drive the Afghan government’s investments in homeland security over the forecast period. Police force modernization, border security and infrastructure development are expected to be the primary areas of focus.

The report "Future of the Afghan Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023" offers detailed analysis of Afghan defense industry with market size forecasts covering the next five years. This report will also analyze factors that influence demand for the industry, key market trends, and challenges faced by industry participants.

In particular, it provides an in-depth analysis of the following -
- Afghan defense industry market size and drivers: detailed analysis of Afghan defense industry during 2019-2023, including highlights of the demand drivers and growth stimulators for the industry. It also provides a snapshot of the country’s expenditure and modernization patterns
- Budget allocation and key challenges: insights into procurement schedules formulated within the country and a breakdown of the defense budget. It also details the key challenges faced by defense market participants within the country
- Porter’s Five Force analysis of Afghan defense industry: analysis of the market characteristics by determining the bargaining power of suppliers, bargaining power of buyers, threat of substitution, intensity of rivalry, and barriers to entry
- Import and Export Dynamics: analysis of prevalent trends in the country’s imports and exports over the last five years
- Market opportunities: details of the top five defense investment opportunities over the next 10 years
- Competitive landscape and strategic insights: analysis of the competitive landscape of Afghan defense industry. It provides an overview of key players, together with insights such as key alliances, strategic initiatives, and a brief financial analysis

Companies Mentioned - General Dynamics Corporation, Sierra Nevada Corporation (SNC), Lockheed Martin, and MD Helicopters

Scope
- After the NATO-led International Security Assistance Force (ISAF) left the country in 2014, Afghan security forces were made responsible for protecting the country. Afghanistan’s total defense expenditure decreased at a CAGR of -1.78% during the historic period, from US$6.4 billion in 2014 to US$6 billion in 2018. Around 34% of the national budget was allocated to security expenditure in 2017, however, the negative CAGR was caused by a decrease in foreign aid which previously benefitted the security sector.
- Over the forecast period, the procurement of weapons, construction of infrastructure, and acquisition of assets are expected to drive capital expenditure. The average share of revenue expenditure is expected to be 89.4% over the forecast period, higher than the average share of 84.8% during 2014-2018. The country’s increased focus on Afghan armed forces training sessions and better military personnel pay has resulted in a higher share of the defense budget being allocated to revenue expenditure, a trend expected to continue over 2019-2023.
- The MoD is expected to invest in land-based C4ISR, man-portable and vehicular tactical communications, multi-mission helicopters, starionary tactical communication stations, and attack helicopters.

Reasons to buy
- This report will give the user confidence to make the correct business decisions based on a detailed analysis of Afghan defense industry market trends for the coming five years
- The market opportunity section will inform the user about the various military requirements that are expected to generate revenues during the forecast period. The description includes technical specifications, recent orders, and the expected investment pattern by the country during the forecast period
- Detailed profiles of the top domestic and foreign defense manufacturers with information about their products, alliances, recent contract wins, and financial analysis wherever available. This will provide the user with a total competitive landscape of the sector
- A deep qualitative analysis of Afghan defense industry covering sections including demand drivers, Porter’s Five Forces Analysis, Key Trends and Growth Stimulators, and latest industry contracts
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