Naya Pakistan housing project
Naya Pakistan housing project
Editorial
Editorial

The Naya Pakistan Housing Programme launched in Quetta by Prime Minister Imran Khan on Sunday is easily one of the most ambitious projects conceived by any government in Pakistan. While speaking PM said that “under the Naya Pakistan Housing Programme, 135,000 housing units will be built across the country in the first phase,” he said. “Twenty-five thousand apartments will be built in Islamabad for federal government employees and 110,000 apartments will be constructed in Balochistan, mainly for the fishermen of Gwadar.

The Naya Pakistan Housing Programme launched in Quetta by Prime Minister Imran Khan on Sunday is easily one of the most ambitious projects conceived by any government in Pakistan. While speaking PM said that “under the Naya Pakistan Housing Programme, 135,000 housing units will be built across the country in the first phase,” he said. “Twenty-five thousand apartments will be built in Islamabad for federal government employees and 110,000 apartments will be constructed in Balochistan, mainly for the fishermen of Gwadar.

Imran khan said that, He as Prime Minister responsible for every person in this country. We have to help Balochistan and take the country forward. Chief Minister Balochistan Mir Jam Kamal term Naya Pakistan Housing Scheme is an important milestone for the people of Balochistan. Addressing the ceremony, Chief Minister Balochistan Jam Kamal lauded the efforts of Prime Minister Imran in resolving the issues of the province, saying “the PM is taking the provincial problems seriously”.

The construction of low cost residential apartments under the project would be completed in various phases. It aims to provide five million houses for low-income individuals and families over the next five years and provide associated benefits of six million new jobs and the revitalisation of over 40 industries related to construction.  The housing initiative announced by PTI government is highly laudable considering the seriousness of the housing shortage in the country. Yet no major government housing scheme has been launched in decades.

The residential apartments will be constructed in Kuchlak and Wahdat Colony areas of Quetta while apartments will also be constructed in Gwadar and Ormara for fishermen and government employees. If Naya Pakistan housing project successful, so this programme would be revolutionary and a model of poverty-reduction for the rest of the world. Alas, the question that always hovers over projects like these is that of financing. A conservative estimate of the costs of the Naya Pakistan Housing Programme is $180 billion over the next five years.

This is more than the state can afford. The government has tried to explain this away by claiming that its only involvement will be in facilitating the programme and that privates banks would be expected to step in by providing 15-20 year mortgages for 90 percent of the houses’ costs with the buyer putting in 10 percent as the initial down payment. If that is truly how the government intends to operate, then this programme is doomed for failure.

One of the biggest problems in the housing sector today is that banks are reluctant to provide home mortgages. For potential homeowners, the interest rates are too high to justify the cost of the loans. Even if there was a complete turnaround in this culture, the estimated cost of the Naya Pakistan Housing Programme is far larger than the total deposits in all private banks.  The intention behind the initiative is laudable, but translating it into outcomes on the ground is likely to prove a bigger challenge than what the party seems to have bargained for PTI government.

The ability of the PTI government to do this is doubted by many but should it even manage to succeed that still won’t make a difference since the prime minister Imran khan has said the financing will be provided by private banks. This, in a nutshell, is the problem with the government’s performance so far.

No one doubts its good intentions but it raises expectations to unrealistic levels and justifies its ability to deliver with voodoo economics. There is much the government can do to reform the housing sector. The PTI government should also directly construct housing for low-income citizens. What it should not do is raise the bar for success so high that there is no way it can reach it. Federal Government has started this ambitious project but it remains to be seen how transparent this project would be.