Unchecked investment

In the last four years alone, Pakistani nationals have invested an astounding $8 billion in Dubai’s property market, according to the Federal Board of Revenue (FBR). In the global context, however, this is hardly surprising for a realty market that is well known for its safe haven status, stable economic growth and bottomed out prices. Between January 2017 and June 2017, investors from 217 countries invested a total of Dh151 billion in Dubai’s real estate market. But in the local context this trend is a bit disturbing because it represents a serious flight of capital from Pakistan. On Tuesday, the National Assembly’s Standing Committee on Finance was told that the authorities in Dubai had so far not shared the names of the people who invested their money in the United Arab Emirates. Their reluctance may be possibly linked to UAE regulations forbidding such disclosures but what is stopping the FBR or the Federal Investigation Agency (FIA) from closely examining this affair and determining the names of the local investors. In any case the State Bank of Pakistan has a designated role to play when Pakistani residents wish to make investments abroad. The SBP, however, has no information whatsoever about the Dubai property transactions — which seems to indicate that these have been done without adherence to the official regulations.

One can understand that neither the FBR nor the SBP is in position to acquire data about all Pakistani investors but surely they can at least collate figures related to a segment of investors. Perhaps the formation of a parliamentary sub-committee will keep the issue alive and succeed in pressuring the FIA into finding out the means used to transfer the money abroad — the key to stemming the illegal flow of money. Everything will depend on the diligence of the NA subcommittee and we wish it the best.

Published in The Express Tribune, October 12^th, 2017.

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