World Bank urges Pakistan to introduce soft home loans for the less privileged
KARACHI: Pakistan should introduce soft loan schemes aimed at the less privileged strata of society for providing them affordable housing, and take requisite action for building a future plan for the low-income segment, said Loic Chiquier, World Bank’s Global Lead on Housing Finance.
Mr Chiquier made these remarks during a meeting of the National Financial Inclusion Strategy Sub-Committee on housing finance organised by the State Bank of Pakistan (SBP) at Association of Builders and Developers (ABAD) House last week.
From the World Bank, Housing Finance Specialist Olivier Hassler, Program Leader for Pakistan Gabi Afram, Financial Sector Specialist Sarmad Shaikh and Financial Sector Consultant Namoos Zaheer attended the meeting.
Representatives from the SBP, House Building Finance Company Limited and Meezan Bank were also present at the event. Various committees consisting of stakeholders agreed to come up with proposals for the common man to avail housing finance at affordable rates.
Chairman ABAD Hanif Gohar said the body was working on building low-cost houses for less privileged people as social responsibility. He, however, stressed: “It is not possible to construct millions of houses single-handedly.” He urged the SBP to ask all commercial banks to release more loans for housing, especially for low-cost housing.
Arif Yousuf Jeewa said that no work is done to provide low-cost houses for people from the low-income group on government level.
Muhammad Hassan Bakshi said there was a shortage of more than 8.8 million units in Pakistan which in itself was ‘a great challenge as well as a great opportunity’.
It was observed by participants that commercial banks are reluctant to give loans to people from informal income groups due to lack of proper documentation.
EVER GROWING SLUMS: Meanwhile, Patron-in-chief ABAD Mohsin Sheikhani said about 38 per cent of the over 200 million population of Pakistan lives in slums. Population in big cities is growing due to the influx of people from rural areas which are devoid of basic amenities.
Problems in cities are increasing due to huge arrival of people resulting in mushroom growth of slum areas, he added.
Sindh has over 1,400 Kactchi Abadis while Karachi alone is home to over 500 of these slums.
“Almost 10m people are living in the slums of Karachi out of over 20m people. It means half of the population of Karachi has no permanent address,” he said.
No record of people living slums is available with local bodies or law enforcement agencies. Lack of record creates a number of social problems, with law and order being a major issue.
“It is hard to find as to who is living in slums and how they ended up there. This information is not even there with the security agencies,” he said.
Many people having criminal records in other parts the country are also coming to settle in slums of Karachi to hide their identities, he added. “The government should not regularise slums or Katchi Abadis as they are but rather should regulate these according to law so that they can be converted into regular societies,” Mohsin said.
ABAD is ready to build ‘free of cost’ apartments on modern lines for slum dwellers and turning the areas into gated communities with schools, hospitals and other civic facilities for the residents.
He said the association has conceived the idea where in cottage industries would be established within the area so that people living there could earn livelihood respectfully. This will help curtail the crime rates too, he hoped.
He said ABAD has given a formula to the government for the development of slums. Builders would build houses and other civic facilities on half of the slum land besides developing commercial residential projects on other half of the land.
He added 99pc of the benefits would go to people while the government would be able to establish its writ through census.
IGP Sindh has recently accepted that slums are major sources of law and order in Karachi, he claimed and went to add: “ABAD wants to take up this project as a social responsibility and not for profit only. Sindh Minister for Katchi Abadis Jam Khan Shoro has endorsed ABAD’s proposal.”
NO LEGISLATION IN CDA, KP: Sources privy to the third meeting of Expert Working Group (EWG) on formation of national policy/legislation on rehabilitation of katchi abadis and affordable housing for low income groups said the Capital Development Authority (CDA) and Khyber Pakhtunkhawa have not made any legislation on katchi abadis and low income housing. On the other hand, Sindh, Balochistan and Punjab are making some progress on the issue.
The EWG meeting was held in the first week of April in Karachi. Members of the KP and Punjab government as well as the CDA remained absent in the meeting.
In an order passed on February 11, 2016, the Supreme Court of Pakistan the federal and provincial governments to prepare draft bills for provision of inexpensive, low cost housing and social housing for inhabitants of slums areas and shelter less people.
The Supreme Court further directed that an appropriate commission be appointed and the present EWG be given the task to conduct the process and complete the same positively within a period of two months with concrete suggestions and recommendations to all the concerned authorities. In this regard two meetings of EWG had already been held in Lahore and Quetta.
The third meeting, held in Karachi, was informed that the Balochistan government has prepared a draft law “The Balochistan Katchi Abadis (Regularization and Development) Act 2016” covering the aspects of low income housing besides addressing the issue of katchi abadis in the province.
The representative of Balochistan government informed the meeting about the action plan for the rehabilitation of katchi abadis. The representative added that fresh data has to be collected throughout the province and district headquarters.
In contrast, representatives from Sindh government said the province has number of specific laws to deal with the issue including the Sindh Katchi Abadis Act 1987, Sindh Katchi Abadis Authority Regulation 1993 (Amendment 2013) and Sindh Katchi Abadis Authority Low Cost Housing Regulation 2008.
Published in Dawn, June 5th, 2016