KARACHI: The Association of Builders and Developers of Pakistan (ABAD), a group of over 700 builders and developers, has said that erroneous policies of government departments have blocked up to Rs200 billion in investments in the property sector, which should be immediately removed to reduce the housing backlog in the country.
The problem is especially severe in Karachi where the Sindh High Court’s ban on high-rise buildings has also affected foreign investors, ABAD Chairman Mohsin Sheikhani said.
The country’s largest representative association of builders is currently preparing for the three-day ABAD International Expo 2017, which will be held at the Karachi Expo Centre from August 12-14. Almost 155 companies from over 23 countries are expected to participate in the event.
ABAD officials claimed that the previous exhibition held in 2016 resulted in memoranda of understanding (MoUs) valuing Rs400 billion, which helped attract new investments in the construction sector.
“The backlog of housing is fast increasing and it will only worsen in coming years,” warned Sheikhani, adding that the current shortage has already crossed 12 million houses requiring investments of billions of dollars.
Leading builders and developers say the federal and provincial governments can attract new investments in the construction sector by providing a helping hand to the private sector through collaboration in policies. Poor planning of successive governments has caused growing housing shortages in the country, developers said.
The construction sector posted a growth of 9% in fiscal year 2016-17, which was lower than previous fiscal year’s growth of 14.6%, according to the Pakistan Economic Survey 2016-17. However, it was still higher than the sector’s meagre average growth of 4% between FY12 and FY16.
Robust construction activities also led to an increase in demand for steel and allied products. For instance, cement sales growth derived from robust domestic demand allowed manufacturers to enhance their capacity utilisation.
“The outlook is encouraging on account of firm demand due to flourishing housing schemes and rising development spending along with anticipated CPEC-related projects,” according to ABAD.
Construction industry officials believe the recent growth is encouraging for the industry as well as the country because it will create new jobs.
Published in The Express Tribune, August 6th, 2017.
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