A challenge and a dilemma for professional and allied industry
Last year, in October, Prime Minister Imran Khan launched the ‘Naya’ Pakistan Housing Project’ which aimed to construct five million affordable houses in five years for the low-income segments of society. The scheme was a part of the PTI’s election manifesto and aimed at bringing prosperity to the country.
Pakistan is reportedly facing a shortfall of 10 million houses and the ratio of financing available for housing to GDP is just 0.2 per cent.
To achieve this mammoth task, the Prime Minister stated that the government would form a Naya Pakistan Housing Authority and a 17-member task force to look after housing affairs. A land bank would be created which would tend to loans and the financial dealings of the properties. It was also stated that a drive to locate and regulate katchi abadis across the country was also to be held along with a registration drive in different districts of Pakistan to estimate the demand for housing.
The desirable effects of this scheme are plenty. There is hope that it will set in motion 40 other industries which are closely connected to the housing sector (such as banking, maintenance, security) and that investment in the construction sector will help generate more jobs— almost 60 million jobs could potentially be created in the next five years. Since the government has decided to provide houses to the people on installments —2.5 million houses in the first phase, and 2.5 million in the second phase—with the creation of the land bank, the amount of people who can afford housing in the first three years is expected to double.
Moreover, measures to ensure good quality and a low cost are also expected to be taken. For instance, cost will be reduced by standardizing the design and specification, cutting down the approval time for builders, reducing their upfront costs and providing them with project loans. Furthermore, the price of the land would be recovered from the end consumers who will have to pay 20% of the unit price during the construction period having obtained an approval of 80% of the amount for loan from a commercial bank. The loan is to be repaid over a period of twenty years.
So far, no legislation has been passed allowing the establishment of this authority. The National Database and Registration Authority (NADRA) has processed digitisation of 499,040 applications for the scheme. The scheme which was previously launched in seven districts including Sukkur, Quetta, Gilgit, Muzaffarabad, Swat, Islamabad, Faisalabad, has been further expanded to ten more cities including Lahore, Multan, Rahim Yar Khan, Layyah, Bahawalpur, Vehari, Kasur, Sialkot, Jhelum and Gujranwala.
Moreover, in December, last year, the Punjab Government constituted a 21-member task force to oversee the construction of 2.5 million low-cost residential units under the Naya Pakistan Housing Programme (NPHP). The Pakistan Mortgage Refinance Company (PMRC) has also signed an agreement to provide loans worth Rs4.8 billion and a memorandum of understanding (MoU) has been signed at the City University of Science and Information Technology, Peshawar, for technical design and support for the scheme.
Guidelines are yet to be developed and the existing approval process is to be streamlined to give approvals for the processing of applications and infrastructure which is being built for the plots and communities is yet to be developed.
However, the scheme has faced a few hurdles in its implementation. Last month, the Prime Minister stated that progress could not be made unless a case regarding foreclosure laws in Lahore High Court is decided. Foreclosure law enables the lender to take over and sell the mortgaged property if the borrower defaults in debt repayment.
Though the government genuine intentions are clear, once again the lack of infrastructure in the development clause and legal bindings are reasons for the project to have not moved forward. The profession of architecture and construction is also watching closely as the profession and professional rea required to be integrated in the implementation of an important scheme that will have a lasting impression on the cityscapes and the economy.