ISLAMABAD: Pakistan’s construction sector offers enormous investment and job-creation opportunities which can provide a boost to the national economy.
Junaid Alam, Managing Director at Gold Land Estate and Builders, told WealthPK that construction and its allied industries were at a standstill in August 2018, but the stimulus package boosted employment and created wealth for the country’s economy. He said the State Bank of Pakistan (SBP) has announced a mark-up subsidy for house financing. He said that tax breaks and cheaper interest rates encouraged people to invest in real estate.
According to Danish Ahmad, Sales Manager at AAA Associates Real Estate, the prices of construction material have increased dramatically due to the ongoing inflation and unstable dollar position in the market.
WealthPK has explored that the construction financing climbed to Rs60.5 billion during July-March FY2022 compared to Rs32.2 billion during the corresponding period of the last fiscal year.
The revenue of the global construction industry is expected to grow steadily in the coming years. The size of the construction market increased to $6.4 trillion in 2020, and it is expected to reach 414.4 trillion in 2030.
Globally, the construction sector comprises civil engineering, infrastructure projects, and real estate developments. Factors such as increasing private sector investments, technological development, and rising disposable income are expected to propel the growth of market. Steel, cement, bricks, aluminium, cables, fixtures, glass, kitchen and bathroom fittings, marble, paint, ceramic tiles, transportation, warehousing, and wood contribute to the construction sector, which employs 7.61% of the overall workforce.
The growth of the construction industry is expected to improve.
The annual growth is estimated to be in the range of 4.8-5.3% between the years 2022-2025.
The Public Sector Development Programme (PSDP) spending on uplift projects, followed by private investments, are the main drivers of demand in the construction sector. The majority of the construction revenue comes from government contracts involving infrastructure building. With the launch of China-Pakistan Economic Corridor (CPEC), the construction sector growth has accelerated. In addition, the government relief packages and subsidies are fuelling the industry’s expansion.
Private and residential building and housing units construction is also an important driver of the sector, particularly in rural areas. Residential housing demand is increasing in tandem with population growth. –INP
