Constructing an impressive period

Posts more than targeted growth of 11.3%

KARACHI: One of the most staggering revelations of the Survey depicted the exceptional growth posted by the construction sector in the fiscal year 2013-14, posting an impressive 11.3% rise, compared to the dismal performance in the previous fiscal year of a negative 1.7%.

The revival of the construction sector has even surpassed the government’s estimates by a wide margin, since it was expecting a 6% growth in the outgoing fiscal year.

Association of Builders and Developers of Pakistan (ABAD) – the umbrella organisation of the country’s over 700 builders – Senior Vice Chairman Salim Kassim Patel said that the resurgence in the construction sector is a positive sign for the economy.

“Double-digit growth in any industry is always positive. I am sure that the construction industry will continue to post strong growth in coming years,” said Patel.

ABAD, from its platform, has recently urged the government to reduce indirect taxes from those industries that are directly related to the construction sector.

According to ABAD estimates, 2 to 2.5 % of the country’s gross domestic product is held by the construction sector, which they believe should increase to 5% to at least match the region’s average share in GDP.

ABAD representatives stress that in case the government and the private sector fail to collaborate, the current backlog of 8 million houses in the country will reach to over 13 million by 2025.

“The construction industry can post double digit growth annually but for that the government has to provide a positive environment,” he said.

Commenting on the strong growth of the construction industry, AKD Securities analyst Asad Siddiqui said that it has been witnessed despite a huge increase in cement prices.

“Cement prices are currently at an all time high but have failed to deter construction activities in the country. It seems that construction activities will grow further in the coming months,” Siddiqui added.