The word "Fauji" is an Arabic loanword that means "soldier" and the company was set up in order to provide employment opportunities to Pakistani ex-military personnel and to generate funds for the welfare of widows, and families of martyrs.[4] It also undertakes welfare projects in education, medical, training, and rehabilitation for military personnel.[5]
In December 1974, Fauji Foundation inaugurated its third textile mill with equipment imported from China.[7]
Fauji Foundation remained relatively modest in scale until the late 1970s when it began to undergo major expansion.[3] The assets of Fauji Foundation increased from Rs 152 million in 1970 to Rs 2,060 million by 1982, with 29 industrial units.[5]
Between 2011 and 2015, the foundation assets grew 78 percent.[8]
A 2017 study found that 33 of a group of 141 former Pakistan Armed Forces corps commanders, or 23.4%, were given jobs by the Foundation after their retirement from the military. At any one time, as many as seven former corps commanders serve as either the managing directors of the Fauji Foundation or the Army Welfare Trust or as managing directors of subsidiaries with personnel in these positions rotated out every three years.[9]
As of 2024, Fauji Foundation runs its own parallel economic system within Pakistan, benefiting people who currently are, or have been affiliated with Pakistan Army.
Fauji Foundation is predominantly managed by the Pakistan Army, with about 85-90 percent of these positions filled by Army personnel.[5] The managing director is usually an Army general, and the board of directors is chaired by the Federal Secretary of Defence, with members drawn from within the organization.[5]
The Fauji Foundation medical system began with the establishment of a 50-bed TB hospital in 1959 at Rawalpindi. Today, the Fauji Foundation medical system is the largest medical chain outside the Government sector, spread all over Pakistan.[citation needed]
On health care, Fauji Foundation spends over 58% of the welfare budget. Fauji Foundation Hospital Rawalpindi and Fauji Foundation Hospital Lahore are well funded hospitals of Fauji Foundation.[33] It is run by former officers of Pakistani Armed Forces.[citation needed]
With over 100 branches spread from Karachi to Gilgit having approximately 45,000 students, 2000 teachers and over 1100 administrative staff, the Fauji Foundation Education system is amongst the largest education systems in the country.[34][35]The Fauji Foundation's education system aims to provide education to the children of ex- armed forces personnel, as well as to civilians. [35]