BoI secretary encourages investors to explore housing sector of Pakistan

ISLAMABAD: Board of Investment (BoI) secretary Fareena Mazhar has encouraged investors to explore housing sector of Pakistan, which offered tremendous “tax-based rebates”.

Eligible developers and builders would be exempted from withholding taxes on the purchase of building materials, she said.

The Board of Investment held an investment seminar on the “Construction and Housing for Sustainable Development” in Dubai, a statement issued by the board said.

Discussing the opportunities in the housing sector, Fareena Mazhar shared that Pakistan’s annual demand of housing was estimated to be around 700,000 units, while only about half of this demand was currently being met.

She encouraged the investors to explore the housing sector of Pakistan, which offered tremendous tax-based rebates under the Tax Laws Amendment Ordinance, 2020 and the incentives and facilitation in project approvals through one-window operation by the Naya Pakistan Housing and Development Authority.

The BoI secretary also said that the Income Tax Ordinance has been amended to declare construction sector as an industrial undertaking, making it eligible for benefits and concession available to other industries.

She underscored that to promote housing and construction of buildings (residential and non-residential) in Pakistan, the State Bank of Pakistan (SBP) has decided to advise mandatory targets to the banks.

Accordingly, each bank would ensure that the financing for housing and construction of buildings would be at least 5 per cent of their domestic private sector credit by December, 2021, she added.

The BoI secretary said the economic development was an area of priority of the government and Pakistan, under the leadership of Prime Minister Imran Khan, has been undergoing bold economic reforms, which helped the country improve significantly in all sectors of the economy.

Fareena Mazhar highlighted that despite being challenged at the economic and geo-political fronts, Pakistan has made considerable improvement in restoring economic stability and the economy was moving on a positive growth trajectory.

The secretary apprised the audience on international think tanks and research groups appreciating Pakistan’s impressive economic turnaround.

She said that this has been accomplished in the backdrop of a well-designed structural adjustment programme that was bringing reforms in all the sectors of the economy and making substantial room for the private sector initiatives.

Further apprising the audience about the initiatives undertaken by the government to facilitate investors, Fareena Mazhar said that the 22 Special Economic Zones (SEZs) were designed to become high-end commercial, technology and manufacturing hubs, and four of these were equipped with state-of-the-art facilities and business ecosystems and ready for investment as early harvest projects.

Underscoring the strategic location of the country, she said Pakistan was a promising regional hub and an important destination for trade and investment.

A wide-based population pyramid and an expanding middle-class further make it a robust consumer market for foreign investors, she said.

Representatives from FWO, Accor Hotels and IHC Group of Companies were among other distinguished speakers of the seminar.

Major General Kamal Azfar, director general, Frontier Works Organization (FWO), highlighted the joint venture opportunities in road networks and motorways in Pakistan.

Jean-Baptiste Recher, vice president of Development Accor Hotels, UAE, shared his future plans about the construction of hotels in Islamabad and Lahore.

President and CEO of IHS Group of Companies, Noman Qamar, also expressed keen interest in investing in tourism and hospitality sectors of Pakistan.

He particularly mentioned investing in hotels and resorts in Karachi, Lahore, Islamabad and the Northern Areas of Pakistan.

The BoI secretary emphasised on the government’s commitment to protect and encourage foreign investments and assured the investors of complete facilitation and assistance from the Board of Investment, foreign missions, and Pakistani embassies regarding their investment endeavours in Pakistan.