PM Imran rolls out Rs330b mortgage financing for construction sector

Initiative will enable low income people to build houses with mortgage financing of as low as 5 to 7% mark-up

ISLAMABAD:

Prime Minister Imran Khan has made another move to revive the coronavirus-hit economy with an initiative to promote the housing and construction sector with Rs330 billion of mortgage financing by the commercial banks in just 18 months.

The prime minister himself unveiled the plan for the revival of the construction sector after a maiden meeting of the newly formed National Coordination Committee on Housing and Construction on Friday.

Commenting on the government's initiative, a leading property developer and businessman Ejaz Gohar said that it was the first plan, which would make it affordable for the low and middle income people to build houses with mortgage financing of as low as 5 to 7% mark-up.

The commercial banks would allocate 5% of their portfolio amounting to Rs330 billion for the construction activities.

He noted that around Rs20 trillion was circulating in the informal unregistered economy and now was the opportunity for the people to get the huge amount of money declared by investing in the real estate sector by December 31, 2020.

Now a person with an income of Rs30,000 to Rs100,000 can build a house of 5-marla with the mortgage financing at 5% and that of 10-marla at 7% mark-up.

Gohar observed that mortgage financing started in the United States 82 years back to kick-start its economy. The government will give a subsidy of Rs30 billion for the construction of houses.

The prime minister has planned to hold meetings of the housing coordination committee every week to remove hurdles that come in the way as the country is far behind in terms of home mortgage financing as compared to the developed world.

As Covid-19 had hit hard the global economy, Pakistan too suffered a great deal due to the pandemic with rise in unemployment and shutting down of businesses, the government's measures for the construction sector would be a much needed timely relief.

Many economically strong countries like China, the United Kingdom, Italy and Spain were forced to impose strict lockdowns spread over months to contain the cases of Covid-19. However, economically fragile countries like Pakistan were caught in a dilemma as the option of complete lockdown was a recipe for disaster, especially for the vulnerable section of the society which comprised a significant portion of the country’s population.

Prime Minister Imran Khan – known for his leadership qualities since his cricketing days – went for a policy of smart lockdown, balancing the need to halt the spread of coronavirus and keep different sectors of the economy functional simultaneously.

The strategy largely worked and the primary sectors of economy are now open with the number of coronavirus cases after hitting the peak are lowering on a daily basis.

In order to deal with the adverse effects of Covid-19, the government had announced a relief package worth Rs1.2 trillion on March 24.

An important component of Pakistan's economic revival plan was the second phase of China Pakistan Economic Corridor (CPEC).

Despite hurdles, Pakistan and China went ahead with the second phase of the mega project during the last two years. After undertaking of the infrastructure, road and energy projects across Pakistan in the first phase, the focus was shifted to the building of eight special economic zones and socioeconomic and human development with the Chinese financial assistance of $1 billion.

The Pakistan Tehreek-e-Insaf government established the CPEC Authority and appointed Lt General (retd) Asim Saleem Bajwa as it head.

Bajwa set his sights on executing vital projects, including M8 motorway from Gwadar (Balochistan) to Ratodero (Sindh) and $230 million Gwadar international airport.

The other projects include a fully fenced 1,800-kilometer long railway track from Karachi to Peshawar, a dry port at Havelian and a new electricity transmission system to augment the ultimate plan of mass industrialisation and relocation of industries from China to Pakistan.

While giving a practical shape to the concept of Riyasat-e-Madina, PM Imran launched his flagship Ehsaas programme to take care of the poor and needy.

This year the government allocated Rs208 billion for different projects under the Ehsaas programme deftly managed by Dr Sania Nishtar, Special Assistant to the PM, gaining appreciation at international forums.

The government had distributed Rs194 billion since April 9 under the Ehsaas Emergency Cash Transfer Programme after the coronavirus began spreading in the country.

One time cash assistance of Rs12,000 each was transferred to 12 million daily wage earners under the programme. According to Minister for Information Senator Shibli Faraz, the cash assistance was distributed among the most deserving and vulnerable families without any political discrimination, during the first phase after imposition of the lockdown in the wake of coronavirus outbreak.

The government this week announced the second phase of the cash transfer programme realising that more urgent steps were needed to mitigate the sufferings of the poor adversely affected by the pandemic.
 One of the hallmarks of PTI government remains its austerity drive.

The incumbent government reduced its wasteful expenses saving hundreds of billions of rupees and examples of that are cut in the exorbitant spending of the PM house and office, considerable reduction in the release of supplementary grants and discretionary funds and an end to the stuffing of government departments with jobs given without merit and on the basis of party affiliations.

Pakistan exists in a region which offers not only enormous opportunities but presents it immense security challenges. By continuing with the state's well-defined policy of maintaining peace with all its neighbours, Prime Minister Imran Khan after assuming office offered talks to Indian Premier Narendra Modi but the opportunity was missed as Modi went ahead on the path of Hindutva and continued with the mistreatment of Muslims and other minorities in his country and the Occupied Kashmir.

After India's reckless move to revoke the special constitutional status of Jammu and Kashmir on August 5, 2019, Pakistan also further hardened its stance and steadfastly persisted with its support for the Kashmiris' right of self-determination granted under numerous United Nations Security Council resolutions.
 Prime Minister Imran Khan took a firm stand against belligerence of Modi against the Muslims in India and occupied Kashmir, and united the nation on the Kashmir issue through a countrywide campaign.

His address in the United Nations General Assembly set the tone of Pakistan on the decades-old festering issue. His widely acknowledged speech made it abundantly clear to the world that without the resolution of Kashmir issue permanent peace between Pakistan and India would remain a mere dream and the region would be prone to war as both the countries have nuclear weapons.

The PTI government successfully continued to engage its neighbours China, Afghanistan and Iran in meaningful and productive relationships in pursuit of the state's strategic goals of regional peace, security and prosperity. The government led by Prime Minister Imran Khan has an undeniable achievement in its two years which has shaken the very foundations of decades-old political system reeking of corruption, misgovernance and incompetence.

The PTI government at its inception was beset with multiple challenges on the internal and external fronts after the country had witnessed an institutional collapse at different levels of governance due to the sheer incompetence and misgovernance of the previous regimes led by two parties well entrenched in the political system.

The country was in a desperate need for resolute leadership and Prime Minister Imran Khan did not budge from his responsibility towards the nation and took the monumental challenges head on.
 He came to power on the slogan of combating corruption and mafias that had penetrated vital sectors of economy.

He went after the mafias and squeezed their space to operate with impunity. Prime Minister Imran Khan inherited an unstable economy after winning elections in 2018 and then the coronavirus reversed many of the advances made by his government on the economic front.

However, now a latest report released by the International Monetary Fund noted that a gradual economic recovery was expected in Pakistan in 2021 as different sectors opened up after getting a severe jolt from the coronavirus. 

Pakistan is a country blessed with immense natural beauty seen in the world's highest snow-capped mountains, lush green valleys and meadows, and fast-flowing rivers traversing its landscape with origins in high altitude north.

This beauty is further magnified with its vast plains, forests, deserts and beaches in its south along the Arabian coast. So the country has a huge potential to boost its tourism.
In the last two years as Pakistan regained its peace after defeating terrorism and insurgency, tourism flourished and tourist flow increased by a mammoth 300 percent.

The government made it easy for foreign tourists to visit the country by launching an online visa service for 175 countries and nationals of 50 countries were offered visa on arrival.
 With the relaxed visa requirements and improved security environment, Pakistan attracted 6.6 million visitors to its tourist attractions in 2019.

Many prestigious international travel magazines ranked Pakistan as one of the top travel and adventure destinations for 2020 before the coronavirus put everything to stop.
But behind this success story and trajectory of Pakistan's stability and growth lies riveting tales of blood, sweat and tears as Pakistan's armed forces valiantly defeated insurgency and terrorism in more than a decade-long campaign predominantly on its western borders to restore peace and bring back sense of security to its citizens.

Alongside an army determined to keep peace and protect the country's vital interests, Prime Minister Imran Khan with his trademark resolve trudges on to navigate a path towards Naya Pakistan which ensures economic opportunities and overall prosperity for every citizen and keep at bay elements responsible for the financial and institutional mess triggered because of their shortsightedness and opportunism for short political gains.