Friday, February 15, 2013

World's Tallest Building Proposed in Karachi

Bahria Town and Abu Dhabi Group agreed to invest $45 billion in real estate in Pakistan. After signing the investment deal, Malik Riaz and Shaikh al-Nahyan announced that Karachi, not Dubai nor Shanghai, will soon boast having the world's tallest building.

Representing the largest foreign investment to date in Pakistan, there will be $35 billion invested in several  large commercial and residential real estate projects in  Karachi, and another $10 billion in Lahore and Islamabad. It's expected to create 2.5 million new jobs in the country.

His Highness Sheikh Nahyan bin Mubarak al Nahyan, Chairman of Abu Dhabi Group, was quoted by Express Tribune as saying, “I am genuinely happy that in this historic project of Pakistan we are working with the visionary Malik Riaz Hussain, this guarantees that not only the project will be delivered beyond our expectations but also before time. We will Inshallah be welcoming first residents in next 3-4 years.”

Why is Abu Dhabi Group interested in investing in Pakistan?  Why not put all or most of these $45 billion in GCC or other Middle East nations?  Answering a reporter's question about the growth prospects of GCC (oil-rich nations of Gulf Cooperation Council) at a recent investment conference in Dubai, Golman Sachs' Jim O'Neill said: "Some GCC countries are well placed to be hubs for the BRIC and N-11-influenced world. I often think of Dubai as a kind of N-11 center, even the capital of the N-11 world, given its business adjacency to Egypt, Pakistan, Iran, Turkey, and, of course, India and Russia."

Pakistan is already experiencing a renewed construction boom with cement sales rising by double digits. Domestic cement consumption surged 10.10% in Pakistan in January 2013, according to All Pakistan Cement Manufacturers Association. On top of 8% increase in Fiscal Year 2011-12, it jumped another 8% for the first seven months of Fiscal Year 2012-13.

There is a lot of privately funded real estate development activity visible in all major cities of the country. Big real estate developers like Bahria Town and Habib Construction are developing both commercial and housing projects in Islamabad, Karachi and Lahore. Other cities like Faisalabad, Hyderabad, Larkana, Multan, Mirpur, Peshawar and Quetta are also seeing new housing communities, golf courses, hotels, office complexes, restaurants, shopping malls, etc.

Cement consumption is an important barometer of national economic activity,  according to a research report compiled by a Credit Suisse analyst.  Last year, CS analyst Farhan Rizvi said in his report that "higher PSDP (Public Sector Development Program) spending has led to a resurgence in domestic cement demand in FY12 (+8%) and with increased PSDP allocation for FY13 (+19%) and General Elections due in 2013, domestic demand is likely to remain robust over the next six-nine months".  This latest investment will add to it. It will give a big boost to the national economy.

The Abu Dhabi Group is a major investor in Al-Falah Bank and United Bank in Pakistan. It recently announced acquisition of all of SingTel’s shares in Warid Telecom, a mobile telephone service operator in Pakistan. With the agreement, the group has become the sole owner with equity holding of 100% in the Pakistani telecom company. Abu Dhabi Group said it plans to improve Warid Telecom’s operations in Pakistan by introducing new technologies, services and packages.

Back in 2008, there was a lot of excitement in Pakistan when  Dubai developer Emaar announced a massive real estate project valued at $43b to develop two island resorts near Karachi. That investment never materialized. Let's hope this time will be different. Let's hope Abu Dhabi Group and Bahria Town will follow through on their commitments.

Here's a video of Malik Riaz speaking with Dunya News:



Related Links:

Haq's Musings

Renewed Construction Boom Pushes Cement Sales in Pakistan

DCK Green City in Karachi, Pakistan

Pakistan on Goldman Sachs' Growth Map

Investment Analysts Bullish on Pakistan

Precise Estimates of Pakistan's Informal Economy

Comparing Pakistan and Bangladesh in 2012

Pak Consumer Boom  Fuels Underground Economy

Rural Consumption Boom in Pakistan

Pakistan's Tax Evasion Fosters Aid Dependence

Poll Finds Pakistanis Happier Than Neighbors

Pakistan's Rural Economy Booming

Pakistan Car Sales Up 61%

Resilient Pakistan Defies Doomsayers

53 comments:

Saqib said...

Muslim world has failed to understand the accumulation and efficient utilisation of Capital. It would be prudent to use $ 45 Billion to build wind power projects to generate desperately needed megawatts , desalination plants along the Makran coast to provide water for Sind and Baluchistan, procure fracking technology to harness gas reserves in Sind and elsewhere in Pakistan, Flood control projects in Punjab and Sind, housing in the rural areas and many more projects to address the real issues.
Tallest buildings and Golf courses will suck the construction materials, and make life even more expensive and unbearable for the common people. Concentration of Capital in few hands will aggravate the socio economic issues leading to more corruption and survival crimes now rampant there.

Hopewins said...

Why are educated, young Pakistanis so cynical these days? Look at their statements:

1) Hasan: "It will never happen!"

2) Sultan: "45 billion is roughly 25% of our GDP! The numbers being bandied about are complete nonsense. Castles in the sand, as the saying goes"

3) Buckding: "Who’s going to use the building? Whilst I welcome this investment, it would have been better to invest in all the provinces, Balochistan in particular. It’s unfair to build the world’s tallest building in Karachi while people are being targeted, killed, starved and have little access to healthcare, education, transport etc. in other parts of the country. We need equality and justice, not empty skyscrapers."

4)Dilbar Jan: "$45 billion will be invested in Islamabad, Lahore and Sindh. What about Balochistan and Pakhtunkhwa? They are not part of Pakistan?"

5) The Khan: "Although i think they may never materialize partly because of dubious nature of Malik Riaz and voilatile environment of Karachi.."

6) Nadir: "Is this an advertisement or news? How about asking some questions on the plausibility of these figures being thrown around! If its too good to be true, it probably is!"

7)Timur: "Huge and successful investments Warid and Wateen ??? Really ??? I thought both entities were both loss making and don’t seem to be able to go into the black despite multiple restructuring efforts…I was their banker so I know."

8)Mujahid: "I don’t believe this…Malik Riaz is such a corrupt person …"

SOURCE: http://alturl.com/368jn

Please go to the website and comment on why people should not be so cynical. All this self-flagellation and self-doubt and cynicism is not good for Pakistan....

Riaz Haq said...

Saqib: "It would be prudent to use $ 45 Billion to build wind power projects to generate desperately needed megawatts , desalination plants along the Makran coast to provide water for Sind and Baluchistan, procure fracking technology to harness gas reserves in Sind and elsewhere in Pakistan, Flood control..."

Abu Dhabi Group and Bahria Town are private investors looking for top returns. They are not do-gooders.

If these investors saw better policy incentives and higher returns returns on the kind of projects you are suggesting, I'm sure they they would do such projects.

In any event, construction projects are generally very labor and material intensive. Such projects create lots of jobs and generate a lot of economic activity to stimulate the economy which lifts all boats. We should welcome these investments.

Riaz Haq said...

HWJ: "Please go to the website and comment on why people should not be so cynical. All this self-flagellation and self-doubt and cynicism is not good for Pakistan...."

It's mostly Indian posters posting under various names on almost every story about Pakistan on Express Tribune newspaper. Such comments are often bigoted ad mostly trash and unworthy of a response.

"Internet Hindus" is a term coined by Indian TV anchor Sagarika Ghose to describe them.

Here's excerpt from a story on Internet Hindus:

NEW DELHI, India — “Internet Hindus are like swarms of bees,” Indian television anchor Sagarika Ghose tweeted in 2010. “They come swarming after you."

The "Internet Hindus" Ghose refers to — actually, she coined the term — are right-wing bloggers and tweeters who seem to follow her every move, pouncing on any mention of hot-button issues like Muslims or Pakistan.

Liberal journalists and netizens sympathized with Ghose's exasperation. But for right-wingers, it was like throwing gasoline on the fire. Since Ghose's tweet, Hindu nationalists and other conservatives opposed to the Congress Party of Sonia Gandhi and Prime Minister Manmohan Singh have, if anything, multiplied and grown more organized — embracing Ghose's derogatory term and making it their own.

Today there are perhaps as many as 20,000 so-called “Internet Hindus,” many tweeting as often as 300 times a day, according to a rough estimate by one of the community's most active members.

“You will find thousands with similar sounding IDs [to mine],” a Twitter user who goes by the handle @internet_hindus said in an anonymous chat interview. “Some [others] prefer to openly do it with their own personal IDs."


http://www.globalpost.com/dispatch/news/regions/asia-pacific/india/120615/internet-hindus-hindu-nationalists-right-wing-politics

Riaz Haq said...

Here's an ET story on Russian book author at Karachi Literature Festival:

KARACHI: VY Belokrenitsky says the country has come a long way since Partition
Many intellectuals believe that internal problems and geopolitical upheavals have taken Pakistan to the brink. But according to Russian scholar VY Belokrenitsky, who has spent decades studying its history, the country remains as strong as any other.
“If you look at all that has happened in the past, Pakistan’s is a success story,” he said during the launch of the book ‘A Political History of Pakistan: 1947 to 2007’ on day two of the fourth Karachi Literature Festival on February 16. He has co-authored the book with compatriot VN Moskalenko.
Belokrenitsky said that at the time of Partition, Pakistan was made up of areas which were less developed and faced problems. “Since then, many parts have urbanised and the population has grown manifold. It has become a vibrant society.”
The book has been divided into seven parts which trace the country’s history from the pre-partition era to the tumultuous end of General (retd) Pervez Musharraf’s government.
Belokrenitsky said the book has been written from the Russian perspective, with a particular emphasis on the relationship between the two countries. However, it also deals with prominent political developments.
“We have discussed matters related to the upper level of politics. There is something going on underneath all that as well and not many people know about that. It needs to be studied more.”
He said that years 2013 and 2014 can be a turning point for Pakistan as foreign troops are expected to exit Afghanistan. Columnist Humayun Gauhar also spoke at the event.


http://tribune.com.pk/story/508270/russian-scholar-labels-pakistan-a-success-story/

Kadeer said...

This is massive !! It has the potential to transform the country. The trickle down will make the economy grow at a much faster pace.

Do you have a detailed time frame other than what the article says? Also, do you know if the story has been picked up by WSJ - because it is matter of time.

Rashid M said...

Riaz - you ended your article with a "Hope" that the project goes through. Really!!! I hope the opposite.

The entire premise of such fanciful projects is flawed. Without going into hadees of tall buildings, there are still sufficient grounds to reject such projects. Tall buildings are power hogs. Where energy is cheap and abundant, this is not a consideration. Where do we get such power in Karachi? Shouldn't humans get power before buildings? By perpetuating people like Malik Riaz, what does it say about our values? He is a part of the whole mess that we see nowadays.

Umar said...

This is 130 times the Centaurus Complex which cost $350 million

Riaz Haq said...

Rashid: " Tall buildings are power hogs. Where energy is cheap and abundant, this is not a consideration. Where do we get such power in Karachi? Shouldn't humans get power before buildings?"

There are downsides to everything and, not surprisingly, you have focused on some of them.

But in this case, I think the benefits clearly outweigh the costs.

To begin with, just think of the 2.5 million individuals whose families will benefits from the jobs created by such massive infusion of capital in a relatively stagnant economy. Their children will be better fed, clothed and educated, improving their future prospects and the country's future as well.

You need to understand that Abu Dhabi Group and Bahria Town are private investors looking for top returns. They are neither angels nor do-gooders.

If these investors saw better policy incentives and higher returns on the kind of projects like power generation that you are suggesting, I'm sure they they would do such projects.

In any event, construction projects are generally very labor and material intensive. Such projects create lots of jobs and generate a lot of economic activity to stimulate the economy which lifts all boats. We should welcome these investments.

Salman said...

If we count the killings in Karachi alone in last 12 months then, may be we could have made the highest tower in the world with a unique feature....made of human skulls,not like those of the other human beings,but of those who never knew why they were shot at ,nor the killers knowing why and whom they are killing.No one ever will be able to break that record.

Riaz Haq said...

Salman: "If we count the killings in Karachi alone in last 12 months then, may be we could have made the highest tower in the world with a unique feature"

Rashid talks about "values" when it comes to constructing tall buildings.

Others in Pakistan rail against Valentine's Day.

But what you point out is where the "values" debate should really come in.

It's easy to blame the govt, the politicians and the United States, but killings in Pakistan will not stop unless the people change their mindset.

A related example is 30,000 Americans who are killed by guns each year and yet most Americans are unwilling to even limit gun ownership in the country. In fact, the gun sales jump every time there's even the slightest talk of gun control.

Riaz Haq said...

Here's a PTI report on world's tallest building in Karachi:

Pakistani construction tycoon Malik Riaz has signed a multi-billion dollar deal with Abu Dhabi group to build the world's tallest building in the country overtaking Dubai's Burj Khalifa.

The project is likely to come up on an island some 3 to 4 kilometres off the coast of Karachi and into the Arabian sea.

Riaz is confident that the project will generate around 2.5 million jobs and promote investment opportunities for different industries.

Riaz signed the USD 45 billion deal yesterday with the Abu Dhabi group which also successfully runs the Al-Falah bank chain in Pakistan.

According to the agreement, USD 45 billion would be invested on different construction projects in Pakistan.

Out of the total amount, about USD 35 billion worth of investments will be made in Sindh while USD 10 billion will be invested in Islamabad and Lahore, media reports said.

"We have selected the site for our mega project which will be spread over 16,000 acres of land and also house 125,000 houses," Riaz said today.

"Besides the world's tallest building the project will include a media city, a sports city, an international complex, a medical and educational complex, restaurants, shopping centres, multiplex halls," Riaz said.

Though Riaz did not name the site where the project would be constructed but sources aware of the developments told PTI that the site for the project would most likely be an island some 3 to 4 kilometres off the coast of Karachi and into the Arabian sea.

"It is most likely going to be the 'Kutta Island' which gets its name because stray dogs which are killed are dumped on it," a source said.

The source said the island was also given to another big construction magnate Emmar properties of the UAE but the project was scrapped.

Riaz said the Emmar project was scrapped and they lost millions of dollars because of the global recession and because there was no direct and strong local presence in the project.

Riaz rose to prominence with his 'Bahria' town residential projects throughout Pakistan and also after the Supreme Court took up the hearing of the case in which the son of Chief Justice Iftikhar Chaudhry was accused of taking money and favours from him allegedly in return of settling cases.

Riaz said the tallest building in Karachi would beat the Burj Khalifa of Dubai.

"This construction project will bring in staggering investment into Pakistan and it will benefit industries and people. My dream is to create a new Pakistan and new Karachi," he said.


http://www.hindustantimes.com/world-news/Pakistan/Pakistan-tycoon-to-build-world-s-tallest-tower/Article1-1012730.aspx

Waseem said...

Why compare one bad example with another, just to garland lesser of the two. May be helps feel little better. Malaysia, France, Germany, Japan and so many others are some who are maintaining better serenity in society, and would be better examples to idealise, compare or be like.
If the country can improve the quality of life of 180M people(Rashid's point), many tall buildings, iinventions, universities will sprout on their own.
$45B are being invested to take out at least 90B in future, concern for improvement of local lot is not a consideration of investors.

Rashid M said...

Riaz - you are correct about the economic impact. I am concerned about the baggage that accompanies such economic progress.

Since times immemorial, kings would loot and plunder neighboring kingdoms. Then they would use this "foreign" wealth to improve their own kingdom by building mausoleums and palaces. The baggage accompanying such acts was the perpetuation of the kingdom of a marauder and his henchmen.

The US saw massive public works projects to stave off the Great Depression. The benefits were the infra-structure development of the 1930s. The cart that came before this horse was the Federal Reserve system which caused the Depression in the first place. But with the deficit financing of those days, now there is no way now to get rid of the Fed. The entire US economy depends upon the Fed and its stranglehold on public debt. This too deep an example left for other times.

Nevada owes its existence to the growth of sin city Las Vegas. The history of Vegas is well known with the Mob providing the financing. A city of lights in the middle of the desert where any delight of the senses is available 24/7. The human cost of such debauchery is well documented. Is this kind of cost-benefit ratio desirable?

When $45 billion is pumped into the economy of Pakistan from the outside, what will be the impact on inflation in the immediate instance? What new concentrations of wealth and power will come to the forefront? As you have noted, there are no angels here. And that precisely is my point.

The "Mob" will bring in $45 billion to an impoverished nation. They will trickle down some money to the masses. But the masses will thenceforth be like the old story of Sinbad and the Old Man of the Sea. You may remember the Old Man who would get on the back of his victims and never get off.

The nation believed in the slogan "roti, kapra, makaan" in 1970. Today in 2013, that same cabal is in power. I can still identify those of us who supported that slogan. 43 years later - and we have not been able to get such people off our backs.

Yet - here you are again trying to empower the same set of crooks. You are justifying the ascendency of people like Malik Riaz. I refuse to accept the premise that any good can come from such people. They can take their $45 billion and "make it 32 and put it up".
It is the "values" of the person and his protectors that I question. And yes - the grandiosity of the building is a value that I question.

Riaz Haq said...

Waseem: "If the country can improve the quality of life of 180M people(Rashid's point), many tall buildings, iinventions, universities will sprout on their own."

Aren't the "180 million people" the "country" when you say if "the country can improve the quality of life of 180M people"?

Who will "improve the quality of life" of these 180 million people? The military? Corrupt politicians repeatedly elected by these 180 million? The pompous judiciary? Or the profit-seeking private investors, the scum of the earth, who create jobs and economic opportunities? Who else?

Who will save these "180 million people" from themselves?

Do you expect a Messiah to suddenly appear from heavens to do it?

Rashid: "Yet - here you are again trying to empower the same set of crooks. You are justifying the ascendency of people like Malik Riaz. I refuse to accept the premise that any good can come from such people.?

Do you know that most pre-industrial empires benefited from conquests and war spoils?

The US greatly benefited from the work of "robber barons" in the 19th century who built it into a great industrial power by WW I?

China became a great industrial power with huge amounts of foreign investments since 1980s?

Unsavory foreign corporations ad their local partners came to leverage low wages, unsafe workplaces, and poor environmental regulations?

Such profit-seeking scum of the earth foreign investors and their local partners also came to countries like Indonesia and Malaysia with significant ethnic Chinese minorities' before going to Mainland China?

Aren't all of these countries better off than Pakistan?

What can we learn from history?

Riaz Haq said...

Here's a Reuters' report on Bahria Town Deal with Abu Dhabi Group:

A member of Abu Dhabi's royal family says he plans to spend $45 billion over up to 15 years on a real estate project in Karachi, touted in Pakistan as the country's biggest ever foreign investment.

Sheikh Nahayan bin Mubarak al-Nahayan said the investment plans - which his business partner in Pakistan said on Friday included the tallest building in the world - were at a very early stage.

Sheikh Nahayan, chairman of conglomerate Abu Dhabi Group, said his privately-owned construction firm, Dhabi Contracting, had signed a memorandum of understanding with Pakistani real estate tycoon Malik Riaz Hussain to build residential properties on an island in Karachi.

"We have signed an MoU but a lot of studies will still have to be done," he told Reuters on Sunday on the sidelines of a defense industry exhibition in the United Arab Emirates capital.

Nahayan, who is also the UAE's minister for higher education, gave no details of how he would finance such huge developments, beyond saying it could be done through loans or cash.

"It will be in phases. Every phase will be studied by itself... It depends on the situation when we decide to go ahead with the projects."

Abu Dhabi Group, which invests in emerging markets, already has large investments in Pakistan including Bank Alfalah (BAFL.KA), Warid Telecom, Al Razi Healthcare and Wateen Telecom.

A statement issued in Pakistan on Friday said the deal had the potential to transform the south of the country.

Karachi, the country's commercial hub, is known for its violent crime, which claims about a dozen lives a day, the risk of being kidnapped and crumbling infrastructure.

The deal included plans to construct a miniature seven wonders of the world, the tallest building in the world, a sports city, an education and medical city, an international city and a media city, according to the press release.

Sheikh Nahayan said on Sunday that a final decision to build the world's tallest tower had not been made, adding that developments would be mainly residential.

The tallest tower currently is the Burj Khalifa, built in Dubai at a cost of $1.5 billion.


http://www.reuters.com/article/2013/02/17/us-emirates-pakistan-karachi-idUSBRE91G04W20130217

Rashid M said...

I concede that history is replete with examples of good coming to those who were being wronged by various miscreants. This has also been referred to as the Law of Unintended Consequences. Yes - your observations are true. But they are post facto. They are emperical observations of a limited sample. There is no logical explanation for the phenomena. (A faith based answer is available.)

I like your pragmatic promotion of Malik Riaz to the status of Messiah. After all, which other Pakistani has promised investing $45 billion of outside money? You say that we should all hold our nose and put on a blindfold and ignore what is apparent - and hope - and hope.

My (deceased) father-in-law had once made a similar observation. He was telling me about some corrupt acquaintance of his - whose kids were getting the finest education abroad. The kids all became well placed professionals later on in life. My father-in-law started the conversation by being morally outraged at the corruption. But he ended the discussion by praising the man who had acquired wealth that would benefit later generations.

I think it is this same dichotomy at play here. For $45 billion let us sell off another portion of our barely present morality. After all $45 billion is a substantial amount.

The US press had said in the 1990s that President Rafiq Tarar had sold a suspect for $5 million. But the sad thing, they wrote, was that for that same price or less he would have sold his mother.

Riaz Haq said...

Rashid M: "I concede that history is replete with examples of good coming to those who were being wronged by various miscreants. This has also been referred to as the Law of Unintended Consequences. Yes - your observations are true. But they are post facto. They are emperical observations of a limited sample."

Have you heard the Abraham Lincoln quote: "My experience has taught me that a man who has no vices has damned few virtues"?

Waseem said...

Riaz,

You must have heard the story of slaves who needed the lashing to feel good for the day, and once the master was no longer there, they decided to lash each other, just to feel right. That is what 180M are like now.
To answer your question, "yes the 180M need a Messiah now", my opinion. Not a pessimistic's niether one's who's resigned to fate accomply, just a realistic view.
Societies deranged so badly were fixed either by social revolution or they ceased to exist. Quetta in last 2 months has shown us the depth of social pit we aready are in.

Riaz Haq said...

Waseem: "Societies deranged so badly were fixed either by social revolution or they ceased to exist. Quetta in last 2 months has shown us the depth of social pit we aready are in."


Khuda Ne Aaj Tak Us Qaum Ki Halat Nahi Badlee
Na Ho Jis Ko Khayal Khud Apni Halat Badalne Ka

I do think the process of social change has begun and growing violence is part of the process.

Whether it was the bloody Civil War to abolish slavery in America or the Meiji Restoration that transformed feudal Japan into an industrial giant, history tells us that violent conflict has been an integral part of the process of social change. Pakistan, too, is experiencing a similar violent social revolution. It started well before the terrorist attacks of 911 and the subsequent US invasions of Afghanistan and Iraq. It has only intensified after these events.

The "peace of the dead" has ended with the continuing "eclipse of feudalism" in Pakistan. A significant part of the what the world media, politicians and pundits call terrorism is in fact an "unplanned revolution" in the words of a Pakistani sociologist, a revolution that could transform Pakistani society for the better in the long run.

Violence is being used by the defenders of a range of old feudal and tribal values in Pakistan. Some of the traditionalists are fighting to keep girls at home and out of schools and workplaces while others are insisting on continuing traditional arranged and sometimes forced marriages within their clans. Such violence is being met with brave defiance, particularly by the younger generation.

Rapid urbanization , rising economic mobility and media and telecom revolutions have been the key contributors to the process of social change in the country. New York Times' Sabrina Tavernise described the rise of Pakistan's middle class in a story from Pakistani town of Muzaffargarh in the following words:

For years, feudal lords reigned supreme, serving as the police, the judge and the political leader. Plantations had jails, and political seats were practically owned by families.

Instead of midwifing democracy, these aristocrats obstructed it, ignoring the needs of rural Pakistanis, half of whom are still landless and desperately poor more than 60 years after Pakistan became a state.

But changes began to erode the aristocrats’ power. Cities sprouted, with jobs in construction and industry. Large-scale farms eclipsed old-fashioned plantations. Vast hereditary lands splintered among generations of sons, and many aristocratic families left the country for cities, living beyond their means off sales of their remaining lands. Mobile labor has also reduced dependence on aristocratic families.

In Punjab, the country’s most populous province, and its most economically advanced, the number of national lawmakers from feudal families shrank to 25 percent in 2008 from 42 percent in 1970, according to a count conducted by Mubashir Hassan, a former finance minister, and The New York Times.

“Feudals are a dying breed,” said S. Akbar Zaidi, a Karachi-based fellow with the Carnegie Foundation. “They have no power outside the walls of their castles.”


http://www.riazhaq.com/2012/12/violent-conflict-is-part-of-pakistans.html

Hopewins said...

^^RH: "Back in 2008, there was a lot of excitement in Pakistan when Dubai developer Emaar announced a massive real estate project valued at $43b to develop two island resorts near Karachi. That investment never materialized. Let's HOPE this time will be DIFFERENT. Let's hope Abu Dhabi Group and Bahria Town will follow through on their commitments"
-----

Any SPECIFIC REASON WHY this one should be different? In other words, do your "hopes" have any basis other than the usual giddy glass-is-overflowing optimism?

Fool me once, shame on you. Fool me twice, shame on me....

HopeWins Junior said...

Allah nay har ek insaan kay galey may uski naseeb bandhee hay. Yeh tarraqi hamarey naseeb may nahin hay. Yeh to loh-e-mehfooz may likha hay.

Yeh sab Allah kee daen hay. Allah jis ko chahey jo chahey deta hay. Allah nay jo chaha wohi hamaree taqdeer hay. Kismat ko kaun badal sakta hay.

Riaz Haq said...

HWJ: "Allah nay har ek insaan kay galey may uski naseeb bandhee hay. Yeh tarraqi hamarey naseeb may nahin hay. Yeh to loh-e-mehfooz may likha hay."

What you suggest is nonsense!

Allah's commandment is here in Surat Ar-Ra`d (Quran 13:11):

Indeed, Allah will not change the condition of a people until they change what is in themselves.

Quran Chapter 13: Verse 11

Allama Iqbal has captured the essence of it as follows:

Khudi ko kar buland itna ke har taqder se pehle
Khuda bande se ye poche bata teri raza kia hai


Elevate yourself so high that even God, before issuing every decree of destiny, should ask you: Tell me, what is your intent.

Hopewins said...

^^RH: What you suggest is nonsense!
----

Look at Kuwait, Saudi Arabia, UAE, Qatar, Oman in 1970: they were dirt poor backward countries. And look at them now.

How did this happen? Was it something they did because they believed that "Allah helps those who help themselves"? Or was it because Allah gave them oil because he so wanted, and that had nothing to do with their actions?

Now look at Pakistan. Why did Allah not give us the oil he gave those people? Why has Allah made us so poor? Why does Allah keep us so poor?

The answer is because Allah is displeased with us because we have too many Ali-worshipping Shia and Grave-worshipping Barelvis and Song-and-dance Sufis.

This is why Pakistan has not received the blessings of Allah the way the pure Arabs in KSA, UAE, Kuwait, Qatar have.

Once LeJ, Taliban etc remove all the unislamic practices from Pakistan and establish True Shariah-- we will ALSO be blessed with MASSIVE OIL and then we will also make progress.

Allah gives to whom he pleases and he chastises whom he please; Allah is not bound by Logic or Reason.

Riaz Haq said...

HWJ: "Look at Kuwait, Saudi Arabia, UAE, Qatar, Oman in 1970: they were dirt poor backward countries. And look at them now."

Pakistan is blessed with human resources which are far more valuable than the hydrocarbons which are an exhaustible commodity.

This is the reason why none of the oil-rich GCC nations are part of Goldman Sachs' BRIC and N-11 groups of nations.

Riaz Haq said...

Here's an ET report on soaring profits at Nestle Pakistan:

Profits at Nestle Pakistan shot up in 2012 as the company saw its margins increase for the first time in four years, as more and more consumers from Pakistan’s rising middle class are able to afford some of its higher-margin products.

On Monday, the company announced its financial results for the year ending December 31, 2012 – and it was a remarkably positive report: net revenues were up 22% for the year to Rs79 billion, and profits up an even higher 25.6% to Rs5.9 billion compared to the same period in the previous year.

The strong revenue growth for Nestle is particularly remarkable, considering the fact that it is the largest food and consumer goods company in the country, and yet still shows little sign of a slowdown in growth. Indeed, much of that growth appears to be volumetric, showing that consumers have a higher demand for Nestle’s products rather than revenue increases simply being a function of inflation.

But perhaps most encouraging for the company was its increase in gross profit margins, which rose from 25.8% in 2011 to 27.2% in 2012, suggesting that the company is selling more of its higher-margin products. At least some of that higher margin, however, was eroded by higher logistics and distribution costs.

Part of the reason for those higher costs is the installation of more refrigerators as more of its chilled products get sold (mostly yogurt). But another part of it may be that the company is expanding its distribution network into areas where transportation infrastructure is poor and cost of getting products to customers is higher, driving up its overall average.

Nonetheless, Nestle’s size in Pakistan – though miniscule by global standards – appears to insulate it from the kinds of risks that some of its smaller competitors face. Engro Foods, for instance, has somewhat higher distribution costs as a percentage of revenues than Nestle.

Nestle Pakistan’s Swiss parent is the world’s largest food company, with a wide array of products: from those that are commodity-like, to higher-margin products like health foods and chocolates. In Pakistan, however, Nestle has, until recently, been primarily a dairy company. Indeed, until the early 2000s, Nestle’s presence in the country was incorporated as Nestle Milkpak Ltd, named after its signature product. It remains the largest player in the dairy market, collecting milk from an estimated 190,000 farmers spread over 145,000 square kilometres in Punjab and Sindh.

Over the past few years, the company has expanded its product portfolio in Pakistan to include fruit juices, breakfast cereals, instant noodles and confectionaries. But it is still a small proportion of its global portfolio.

Nestle’s ability to rapidly grow its revenues and profits despite being the biggest player in Pakistan appears to be indicative of the tremendous room for growth in the Pakistani market. Consumer spending is expanding as the country’s middle class grows on the back of rapid urbanisation, and increasing household incomes as more and more young people enter the workforce.

Even the advent of a strong local rival in the form of Engro Foods does not appear to have dented Nestle’s growth prospects. In earlier conversations with The Express Tribune, officials at both Nestle and Engro Foods are keen to downplay any talk of a rivalry between the two companies, insisting that there is plenty of room for both to grow. Considering the blowout growth at both firms, there appears to be considerable merit to their argument.

The global giant is currently on track to invest upwards of CHF320 million ($347 million) in expanding its production capacity within Pakistan as part of a three-year plan.


http://tribune.com.pk/story/509211/corporate-results-profits-soar-at-nestle-pakistan-as-margins-rise-again/

Riaz Haq said...

Here's ET on Karachi's booming stock market:

KARACHI: Even as most of the city remained shut on Monday owing to a strike call, the Karachi Stock Exchange’s (KSE) benchmark 100-share index gained 0.38% or 68.39 points to end at 17,865.61 points.

The rally was helped by positive news flows from multiple sources, prominent among which were expectations that the cement sector would record a surge in earnings due to stronger domestic sales, higher prices and lower input costs. Also featured was news that the Oil and Gas Development Company (OGDC) had signed direct agreements with fertiliser manufacturers for the supply of gas, and increased expectation that telecom companies will record higher revenues following Pakistan Telecommunication Company’s stellar profits on the back of higher international call termination rates.

Trade volumes remained flat at 292 million shares compared with Friday’s tally of 293 million shares. The value of shares traded during the day was Rs7.18 billion.

“Led by Engro and DG Khan Cement (DGKC), the Karachi bourse achieved a new high,” observed Samar Iqbal, equity dealer at Topline Securities. Both Engro and DGKC’s stocks closed at their upper price limits by the end of the day.

“The said agreement [between Engro and OGDC] will allow Engro to receive gas directly from gas fields, reviving financial prospects for its fertiliser business,” reported Sibtain Mustafa from Elixir Securities. “DGKC continued its positive momentum from last closing as news reports of a $45 billion deal between the Abu Dhabi Group and real estate tycoon Malik Riaz brought in fresh interest.”

Shares of 360 companies were traded on Monday. At the end of the day, 147 stocks closed higher, 161 declined while 52 remained unchanged. Pakistan Telecommunication Company was the volume leader with 29.23 million shares, gaining Rs0.82 to finish at Rs22.77. It was followed by Pace (Pakistan) with 26.60 million shares, gaining Rs0.39 to close at Rs4.32 and NIB Bank with 19.83 million shares, gaining Rs0.15 to close at Rs2.88.

“The majority of volumes were focused on third-tier stocks [...] as retail participation continues to rise. Furthermore, news of Ministry of Petroleum agreeing to increase POL margins by Rs0.25 per litre for motor spirit and Rs0.10 per litre for high-sulphur diesel brought interest in listed oil marketing companies near market end,” Mustafa added.

Foreign institutional investors were net buyers of Rs88.51 million worth of shares, according to data maintained by the National Clearing Company of Pakistan Limited.


http://tribune.com.pk/story/509210/market-watch-bourse-continues-climb-despite-strike/

Kadeer said...

Bahria Town
Reko Diq
KSE Bullish
Remittances
Food Industry Growth
Car sales
Cement Production
Middle Class Growth
Rural Consumption
Lower Poverty
High Education Attainment......

A platform has been created and it is likely that Pakistan will be a major international player with explosive high economic growth by the end of this decade. A positive transformation is taking place and it is a good feeling for all Pakistanis.

hamid said...

Kadeer said "A positive transformation is taking place and it is a good feeling for all Pakistanis."

I think not. Feeling patriotic is one thing but not recognizing poor governance and poor economic performance is false hope.

It is like a like a relative has cancer and you just say 'sub tikh ho jayega, aapke liye allah se dua mangta hoon' and no medical treatment is given.

I dont know if Zardari should get the blame but, many issues have not been addressed. Now even textile exports are suffering due to power shortage. We have not even diversified exports because businesses lack the incentive.

The potential is there but, we are pushing problems under the rug and hoping for the best!

Riaz Haq said...

Here's a Nation newspaper story on Korean companies exploring investment in Pakistan:

Representatives of about twenty (20) Korean investment companies are scheduled to visit Pakistan from Feb 27 to March 2 to explore investment.

During the visit, the representatives of these companies are scheduled to hold meetings with the concerned quarters of the projects, sources of BOI said. According to details, the companies include Samsung Constructions and Trading Corporation that will hold meetings for investment in LNG offshore receiving terminal project, CNG bus project through PPP mode and power projects.

The company has also been requested to invest Karachi-Hyderabad expressway and Karachi-Port Qasim elevated expressway, the sources added.

Lotte Group would explore projects in petrochemical sector while Wisdom will be seeking investment opportunities in agriculture sector by utilizing the strengths of both the countries as Pakistan has rich agriculture and dairy resources while Korea has advanced food processing technology.

Similarly, Six-Group Company would be looking projects in LNG and steel market and is also expected to take part in the tender floated by Sui Southern Gas Company.

Korean Railroad would seek investment potential in supplying unused locomotives to Pakistan in addition to providing simulators and training for locomotives’ drivers through KOICA grant.

ECO-One would look investment opportunities in auto rickshaw market, while Korea Water Resource Corporation (K-Water) is interested in hydro power sector and consortium with Daewoo E&C in hydropower project and Lower Palos Valley project.

Dooson Corporation can be a potential investor for Special Economic Zones in Pakistan while GS E&C is interested in desalination, hydro power sector and highway projects. CK Solar will look for opportunities in solar energy sector as the company has been doing a pilot project of about 65kw in PM house and has signed 300 MW solar plant agreement in Balochistan.

Dongin Medical Centre is planning to establish a hospital and resort in any major city of Pakistan while Deokjae Construction (Pvt) Ltd is interested in road and high ways projects as it has participated in Hyderabad Mirpurkhas Dual Carriage Road Project.

Sambo Engineering Company and Korea Engineering Consultants Corporation is also interested in road and hydro power projects.


http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/20-Feb-2013/koreans-to-visit-pakistan-in-last-week-of-feb

Riaz Haq said...

Here's Bloomberg on OGDC earnings report:

Oil & Gas Development Co., Pakistan’s biggest energy explorer, posted a 20 percent surge in second-quarter profit after production increased.

Net income climbed to 23.6 billion rupees ($240 million), or 5.48 rupees a share, in the three months ended Dec. 31 from 19.7 billion rupees, or 4.57 rupees, a year earlier, the Islamabad-based company said in a filing today. Sales rose 29 percent to 56.8 billion rupees.

“A backlog in development, which is now coming online, as well as fast-track development of recent finds is helping to improve the company’s production profile,” said Naveed Vakil, director research at AKD Securities Ltd. in Karachi. “The company is also benefiting from the decline in the Pakistani rupee that fell nine percent in the quarter” compared with a year earlier, he said.

Oil and Gas Development benefited from an eight percent increase in crude production to almost 39,000 barrels a day. Gas output also rose as much as 12 percent to 1,150 million cubic feet a day, Vakil said.

Shares for Oil and Gas Development fell 1.3 percent, the most in almost three weeks, to 205 rupees at 10:21 a.m. in Karachi. They’ve gained 7.5 percent this year, compared with a 5.3 percent increase in the benchmark KSE 100 Index. The company plans to pay an interim cash dividend of two rupees a share.


http://www.businessweek.com/news/2013-02-20/pakistan-oil-and-gas-development-quarterly-net-rises-on-output

Riaz Haq said...

Here are excerpts of two stories about Karachi Literature Festival:

1. The Independent:

Karachi and Lahore literary festivals are proving a lifeline for the ‘other Pakistan’. The literary and intellectual scene is helping to provide a narrative arc for the country. At one session at the Karachi literary festival last Saturday a minute’s silence was held for the Hazara community and the victims of the militants.

In the morning Mohammed Hanif launched his short book The Baloch who is not Missing & others who are. How would you feel, he asked the audience, if your son or daughter did not return from their lessons? “If your child is late and he and his teachers do not answer their phones for two hours, what state will you be in?”
-------
A raft of Karachi novelists present at the festival, in addition to Kamila Shamsie and H M Naqvi, included 89-year-old Intizar Hussain whose Basti has just been shortlisted for the 2013 International Man Booker prize. The book has received a rapturous review by Pankaj Mishra: “This brilliant novel from one of South Asia’s greatest living writers, should finally end the scandal of his relative obscurity in the West”.

In a session entitled ‘The dynamics of Karachi’, one of Pakistan’s leading architects Arif Hasan and French researcher Laurent Gayer found ways to constructively pin-point the city. Kamila Shamsie’s twitter feed mapped this session: the ethnic divide is understandable; it is linked to land, but the religious divide is not understandable, it is being promoted.

----

In recent years no city has done more to map the narrative arc of Pakistan to international audiences in English through its writers. At the first literary festival in over 20 years, Bapsi Sidhwa, Tariq Ali, Mohsin Hamid, Mohammed Hanif, Ali Sethi, Daniyal Mueenuddin and Nadeem Aslam will be talking about literature and the view from the north.


http://blogs.independent.co.uk/2013/02/21/pakistan-finds-a-literary-arc-in-impossible-times/

2. NPR Radio:

Any literary event would risk being irrelevant in a place as troubled as Karachi. Yet this festival was intensely relevant. The most prominent Pakistani novelists to emerge in recent years have made their country's crisis central to their art.

In a panel discussion, novelist Mohsin Hamid said he couldn't imagine separating politics and fiction. His The Reluctant Fundamentalist depicted a man's drift toward extremism; his forthcoming novel is called How to Get Filthy Rich in Rising Asia. Other sessions included Mohammed Hanif, who fills his darkly comic novels with power-mad generals and corrupt cops like those he covered as a journalist. Hanif was at the festival to introduce his new nonfiction work: profiles of Pakistanis who have disappeared as the government tries to crush an insurgency in the province of Baluchistan. His gut-punch of a book begins with a 4-year-old being shown the bullet-riddled body of his father.

Discussions at the festival were as intense as the writing. Organizers arranged an onstage talk with Cameron Munter, who until recently was the U.S. Ambassador, the representative of Pakistan's profoundly unpopular ally. Even people at this Western-leaning event had doubts about American policies, and a standing-room-only crowd hurled raw questions at the ambassador. "You're not serious" about nurturing Pakistan's democracy, a woman in the audience declared. It's true that America has collaborated with military rulers, and has struggled to support the elected government in power today.


http://www.npr.org/2013/02/20/172484768/finding-a-path-for-pakistan-at-the-karachi-literature-festival

Riaz Haq said...

Here's a report of Japanese investment in Pakistan:



TOKYO (Kyodo) -- Yamaha Motor Co. will build a motorcycle plant in Pakistan with the aim of starting production in 2015, in an attempt to expand its business in an untapped emerging market, company President Hiroyuki Yanagi said Friday in an interview with Kyodo News.

Yamaha will first invest 1.3 billion yen in the Pakistani plant before increasing the amount to a total of 10 billion yen by 2020 to raise its production capacity to 400,000 units a year.

"Motorcycles sold now in Pakistan are mainly Chinese-made, but they are very old," Yanagi said. "We'd like to stimulate the market by introducing new models."

Yamaha has set its initial production target at 40,000 units per year.

The motorcycle market in Pakistan is expected to double to 3 million units in 2020 from the 2013 level of 1.5 million, according to the Japanese manufacturer.


http://www.manufacturing.net/news/2013/02/yamaha-building-motorcycle-plant-in-pakistan

Riaz Haq said...

Here's a Dawn report on KESC's plans to invest $500 million in Karachi power infrastructure:

KESC would invest about $500 million for setting up of coal-based power plants, improvement in transmission and distribution systems in Karachi during the next five years, said Tabish Gohar, chairman, KESC board of directors here on Thursday.

A five-member KESC delegation briefed the Minister for Water and Power, Chaudhry Ahmad Mukhtar, on plans to improve power supply situation in Karachi.

Mr Gohar said that the Bin Qasim power plant would be converted on imported and local coal to generate 400MW cheaper electricity with an investment of $300 million.

The conversion plan would take almost 20 months to complete.

The KESC would spend $80 million on conversion of gas-based plants on combined cycle, while $80 million would be spent on smart grid station that would help improvement and transmission system.

The KESC chairman said that due to investment plan, the power system in Karachi would improve, and power thefts and line losses would be checked.

He also briefed the minister on outsourcing of some of its feeders and future plans to meet the electricity requirements.


http://dawn.com/2013/02/22/kesc-to-invest-500m-in-coal-plants/

Riaz Haq said...

It appears that Malik Riaz has overstated the real estate deal with Sheikh Nahyan of Abu Dhabi. Here's a clarification published in BR:

It has been erroneously reported by certain media outlets in Pakistan and elsewhere that an investment of $45 Billion is being considered by the Abu Dhabi Group in a major real estate development project in Karachi. The level of Investment referenced has not been discussed or agreed.

"It is possible that the amount referenced may be based upon Bahria Town's own estimates and projections, as the Sponsor and Developer of the project. It is perhaps indicative of the overall market value of the entire development once it is completed in the fifteen to twenty year forecasted timeframe. However, this cannot be verified.

"In order to clarify matters, it should be stated for the record that a non-binding Memorandum of Understanding was entered into by Dhabi Contracting Establishment, a business unit based in Abu Dhabi, which is wholly owned by Sheikh Nahayan Mabarak Al Nahayan, and not by the Abu Dhabi Group. The Memorandum of Understanding was simply an indication of interest by Dhabi Contracting to cooperate with Bahria Town Pakistan (Pvt) Ltd to provide technical support and assistance to the project - as, when and if appropriate commercial terms and conditions were agreed.

"It must be stated clearly and unequivocally that neither Sheikh Nahayan, the Abu Dhabi Group, Dhabi Contracting nor any other related party have undertaken or assumed any financial obligation or commitment to invest in this project and that there is no agreement to do so. However, it should be noted that Sheikh Nahayan continues to value his long-standing relationship with Pakistan and remains committed to his existing investments and to future business opportunities that may arise. It is unfortunate that a discussion on possible technical matters between two construction companies has been misconstrued. "It is also unfortunate that discussions between the parties could not reach any conclusion and the Memorandum of Understanding has been cancelled. "This clarification should adequately correct the record for all interested parties," the clarification concludes.-PR


http://www.brecorder.com/market-data/stocks-a-bonds/0/1156592/

Riaz Haq said...

Here's a report on EIU ranking Karachi and Mumbai tied for the cheapest cities in the world:

New York? London? Moscow? All these cities have one thing in common: They're insanely expensive. But none of them ranks as the most expensive in the world.

No, that designation is reserved for a city all-too-familiar with the apex of the annual Worldwide Cost of Living Survey, published by the Economist Intelligence Unit. In fact, this year's No. 1 has held down the title of world's most expensive city nearly every year since 1992. Aside from current title holder, only Zurich, Paris and Oslo have worn the championship belt in the last two decades.

SCROLL DOWN TO SEE THE TOP 10.

Last year's No. 1, Zurich, ascended to the throne of most expensive city in the world thanks to currency fluctuations. But as the EIU explains, efforts to weaken the Swiss franc helped Zurich and Geneva experience the sharpest drops in the rankings, with Zurich tumbling from No. 1 to No. 7, and Geneva falling from No. 3 to No. 10.

CNN points out that strong local currencies powered Sydney and Melbourne toward the top of the list, each rising four places from their 2012 spots.

"Ten years ago there were no Australian cities in the top 50," the index's editor, Jon Copestake, told the Guardian. "But economic growth has supported inflation, and the strength of the Australian dollar against other currencies besides the U.S. dollar has driven up costs. Visitors will certainly feel the difference and people living there will have noticed prices have crept up."

In a region of sharp contrasts, Asia and Australia account for 11 of the 20 most expensive cities, but also six of the 10 cheapest. Karachi, Pakistan and Mumbai, India tie for the cheapest cities measured.

Other surprises: no U.S. city ranks in the top 20, and Caracas, Venezuela, ranks as the most expensive in the Americas -- but Venezuela can thank inflation and a fixed exchange rate of the bolívar to the U.S. dollar for Caracas' artificially high ranking.

What determines the most expensive city in the world? The EIU explains that its bi-annual list takes into account "400 individual prices across 160 products and services," including "food, drink, clothing, household supplies and personal care items, home rents, transport, utility bills, private schools, domestic help and recreational costs." All cities are compared to New York as a base, with the Big Apple's index set at 100.


http://www.huffingtonpost.com/2013/02/05/worlds-most-expensive-city-2013_n_2622389.html

Riaz Haq said...

Here's a report on new investment in coal-fired power plant in Karachi:

Companies from the United Arab Emerites and China have inked an accord to develop the first phase of 500 (4×125) megawatts (MW) power plant at Port Qasim Karachi.

Burj Power, based in UAE, is a development and advisory firm focused on projects in the Middle East, Asia and Africa. Harbin Electric International Co Ltd out of China is the technical partner.

The first plant is expected to become operational by 2016.

The Express Tribune reports that the total investment will be between $650 million and $700 million.


http://www.mining.com/coal-based-power-plants-in-pakistan-get-700-million-investment-89811/

http://tribune.com.pk/story/510774/planning-ahead-uae-company-to-set-up-coal-based-power-plants-in-karachi/

Hopewins said...

QUOTE: "Reports that Dhabi Contracting, a unit of Abu Dhabi Group, has made financial commitments to a 15-year real estate project in Pakistan valued at US$45bn by its Pakistani developer are untrue and the memorandum of understanding (MOU) between the two parties has been cancelled, HH Sheikh Nahayan Mabarak Al-Nahayan said"

SOURCE: http://alturl.com/mc76y

This has now become a CREDIBILITY issue. You are still listing more and more of the same: "Here's a report on new investment in coal-fired power plant in Karachi: Companies from the United Arab Emerites.."

Why should anyone believe these announcements? What guarantee that these are not another PPP-gimmick to make their FDI-record look good before the elections?

Young people in Pakistaan have now becomes completely cynical and have lost all hope.....

Riaz Haq said...

HWJ: "This has now become a CREDIBILITY issue. You are still listing more and more of the same: "Here's a report on new investment in coal-fired power plant in Karachi: Companies from the United Arab Emerites.."

It's as much a credibility issue for the Sheikh as it is for Malik.

It's stupid to argue that one bad real estate deal affects other more credible investors who see tremendous opportunity for returns from a large country with upwardly mobile population that is growing.

In fact, even Shaikh Nahyan is fully committed to Pakistan as a major investor in several companies in sectors like banks and telecom.

Hopewins said...

^^RH: "It's as much a credibility issue for the Sheikh as it is for Malik"
-----

The Sheikh never made the 45 billion$ statement in Arabic. It was Malik who made the statement to his Pakistani audience in Urdu.

When the newspapers reported Malik's claims in Arabic in the Sheikh's country, the Sheikh denied it and cancelled the non-binding MOU.

If anything, the Sheikh's credibility has been ENHANCED by his clear statement and firm action.

Malik's credibility, however, has been destroyed on the altar of PPP's pre-election drama.
----

^^RH: "It's stupid to argue that one bad real estate deal affects..."
-----

One? Just one?

You said yourself, in the original article itself:

QUOTE: "Back in 2008, there was a lot of excitement in Pakistan when Dubai developer Emaar announced a massive real estate project valued at $43b to develop two island resorts near Karachi. That investment never materialized. Let's hope this time will be different.Let's hope Abu Dhabi Group and Bahria Town will follow through on their commitments."

CLEARLY, this is not an isolated incident. This happens frequently. Tall claims are made and nothing really works out. This pattern of duplicity, aggrandization and betrayal has led to increasing cynicism and loss of hope amongst the Pakistani youth.

Hopewins said...

"World's Tallest Building Proposed in Karachi"

This title is incorrect. It should have read:

"World's Tallest Lies Being Told in Karachi"

Hopewins said...

According to "Dean Khan", this is what was happening in the shadows of the "Tallest Building in the World"....

Feb 26, 2013- QUOTE: "In fact, investment declined to a 60-year low at 12.5 percent of GDP. Foreign private investment nose-dived from $2.0 billion in 2009-10 to $0.7 billion in 2011-12. Economic growth continued to hover around 3.0 percent per annum and failed to provide jobs to over 2.5 million youth entering the job market each year. Unemployment and poverty therefore continued to rise"

SOURCE: http://alturl.com/e7nrz

Riaz Haq said...

Here's Gulf News on various sectors of the economy in Pakistan:

Naveed Vakil, director, research and business development, AKD Securities:

Oil and Gas Development Company Limited (OGDCL): Dollar-based returns and a firm oil price outlook should keep returns high, especially as key development projects come online and the monetisation of recent finds is fast-tracked.

Pakistan Oil Fields (POL): [Its performance is closely linked] to international oil prices that are likely to remain firm in the near term as demand growth recovers, especially from China. POL also offers exposure to Pakistan’s Kohat Basin which is where there has recently been a string of discoveries have been high impact.

Pakistan Telecommunication Company Limited (PTCL): PTCL should post strong earnings growth this year, due to higher margins following the implementation of higher international incoming call rates. Infrastructure is being installed to curtail grey incoming international traffic, which should support legitimate volume as well.

Lucky Cement: Pakistan’s largest cement company should continue benefitting from a rise in domestic consumption led by development spending ahead of the elections. It should benefit from high margins as domestic cement prices remain firm while coal costs remain low.

Furqan Punjani, deputy head of equity research at BMA Capital Management Limited:

Oil and gas

Robust oil prices coupled with [increasing production volumes should] keep the oil and gas exploration and production sector in the limelight in next few years. Revenue streams linked to the dollar and local currency depreciation would also help augment bottom-lines in the sector. We prefer Pakistan Oilfields and Pakistan Petroleum because of their better dividend yields.

Textiles

Based on better exports prospects and higher profit margins (on low cost cotton) as well as a promotion in the gas allocation list by the government, the textile sector has made it onto our list of top investment ideas for 2013. Nishat Mills is the biggest integrated textile unit in Pakistan and will continue to benefit from its well-diversified core operations and the good potential of its portfolio holdings.

Fertilizer

We believe the fertilizer sector presents an ideal mix of defensive and high-growth plays for 2013. Our top pick in the sector is ENGRO.

Cement

Cement prices are currently at an all-time high of Rs440(Dh16.27) a bag. We like companies that can magnify top line growth into the bottom-line, thanks to the deleveraging of their balance sheet. This makes DGKC.PA our top pick in the sector.

Energy

Pakistan is an energy deficit country and the entire production of independent power producers (IPPs) is consumed on any given day. Moreover, with higher and regular subsidies from the government translating into better cash inflows, the sector has once again come into limelight. Furthermore, as revenues and profits are linked to the dollar, the depreciating Pakistani rupee will also benefit this sector. We prefer Hub Power Company, the largest private sector power producer of Pakistan, because of its higher dividend yields and stable bottom-line.

Commercial banks

The Central bank of Pakistan has reduced the base [interest] rate by 450 basis points in the last 24 months. This has reduced the net interest margins of the entire banking sector, barring a few large banks that have the ability to reduce the rates provided to their depositors and keep attracting fresh deposits at lower rates. United Bank Limited is one of them. We prefer UBL [because] of their ability to grow their deposits by double digits at lower cost, coupled with their greater exposure to high yielding long term government bonds. Furthermore their quarterly payout will continue to lure value investors to the bank. ....


http://gulfnews.com/business/investment/politics-set-to-boost-pakistan-1.1153474

Riaz Haq said...

Here's a Daily Times report on State Bank Governor Yaseen Anwar's assessment of Pak economy:

KARACHI: Pakistan’s economy has the ability to navigate through choppy waters and the economic potential this country holds encourage all to become a part of the country’s future.

The Governor State Bank of Pakistan (SBP) Yaseen Anwar at Pakistan Navy War College Lahore said while our current economic situation was less than optimal and it was also very far from what might be described as an economic calamity.

Anwar said in 65 years, Pakistan has never gone through an episode of hyperinflation, Pakistan has never defaulted on its international and domestic debts, in fact our economy has grown consistently, but not spectacularly, over the past six decades.

This has been despite periods of international alienation and sanctions, three expensive wars, two hostile fronts, regular political upheaval, social unrest, sharp increases in the price of oil, and much, much more, he added.

State Bank has always ensured that the financial system of the country remains safe and stable. The robustness of our financial system is a direct consequence of the reforms process and the State Bank’s constant vigilance, he said.

There is a lot that can be improved in our financial system. He called for the development of efficient debt markets, even better regulatory and reporting practices and the broadening of the financial sector’s scope to include largely unbanked sectors of the economy, such as agriculture, small and medium enterprises and housing.

‘Despite this wish-list, the fact remains that our financial system is, by design, secure and does not pose any threat to the economy as a whole,’ he added.

The size of Pakistan’s undocumented economy is by some estimates, as large as the formal economy. The informal economy does not file taxes and while it does absorb a significant chunk of the labour force, it also evades corporate and labour laws, he said.

Although close informal relationships do make the economy more resilient, they do so at a cost to the overall economy, by eroding the ambit of the regulators.

He stressed the need for the greater integration of country’s domestic market with global markets but observed it does not mean that we should not have proper controls and mechanisms in place to safeguard our own interests. ‘Greater integration with financial markets will mean that capital will flow more quickly through our borders. It’s definitely something that will boost the national economy, but, as most East Asian countries learned in the 90s, it can be a double-edged sword.

Therefore having some capital controls in place, which reduce the volatility of capital flows, is a necessary regulation in this day and age, Anwar added.

More effective regulation is the need of the hour for our own economy, he said, adding it is an essential part of what is needed today to get the economy on a track for steady and sustainable growth.

He said the government’s footprint in some sectors of the economy was very large and quite negligible in other sectors.

Such divergence is unhealthy. Effective regulation is sorely lacking in other sectors. The tax machinery can be tightened considerably. One of the country’s most challenging problems today is the size of the fiscal deficit-and a large part of the solution lies in increasing our tax base by enacting regulation that encourages tax compliance, and punishes tax evasion, he added.

The government will need to borrow less money from the central bank. Borrowing from the central bank is popularly known as printing money, he said, adding if government borrowing from the central bank falls, inflation will follow suit.

Therefore, better tax collection is a necessary condition for faster economic growth. And for that we need to have more effective tax regulation, he added.

....


http://www.dailytimes.com.pk/default.asp?page=2013\03\06\story_6-3-2013_pg5_1

Riaz Haq said...

Here's PakistanToday on Non-Bank Financial services (NBFS) report:

KARACHI - The Securities and Exchange Commission of Pakistan (SECP) on Monday unveiled a document titled ‘Report of Non-Bank Financial Sector’ (NBFS) Reforms Committee’ for public feedback.
Prepared by senior SECP officials and leading market professionals, the report contains proposed reforms for the development of the non-bank financial (NBF) sector in Pakistan.
SECP Chairman Muhammad Ali, commissioners and leading professionals and businessmen from the financial sector attended the ceremony.
Addressing the ceremony, Ali said it was imperative that the SECP and the State Bank of Pakistan (SBP) work in close cooperation for effective and seamless regulation across the financial sector in a globally integrated market.
He said Pakistan’s financial sector was bank-centric with NBF sector accounting only 4.9 percent (excluding insurance sector) of the financial sector’s total assets. This dependence on the banking sector, he said, made the country’s financial system vulnerable to risks through lack of diversification and also restricted the scope of product innovation
----------
In terms of the proposed regime, capital market activities of all entities including that of commercial banks and DFIs are to be regulated by the capital market regulator (CMR), i.e., SECP and deposit taking/financing/lending activities of all the financial sector participants would be regulated by the banking regulator (BR), i.e., SBP. This recommendation is in contrast with the prevalent concept of entity based regulatory
domain in Pakistan.
Other proposed reforms for the mutual fund industry include distribution of mutual fund units through stock exchanges, reduction in the annual regulatory fee provided more than 50 percent of a funds’ net assets are held by retail clients, introduction of concept of expense ratio, introduction of multiple classes of units based on the investment amount, improving the skill set of key personnel such as fund managers by specifying a minimum criteria among others.
Investment finance services are broken down and redefined as stock brokerage, investment advisory, corporate advisory, securities financing and securities underwriting services and each component has been further defined. Flexibility has been offered to an entity to be reclassified as non-bank finance company to obtain either a full scope or limited scope. The suggested regime for IFS outlines a mechanism to transform existing brokerage houses as NBFCs to become part of NBF sector. The inclusion of brokerage services in NBF sector is expected to open up a new era of licensed activities for brokers including advisory and other ancillary services.
To facilitate the launch of the real estate investment trusts (REITs) in Pakistan, the committee has proposed a reduction in REIT fund size to address the issue of
capital constraints and allow launching of medium-size REIT projects having better potential for growth and return.
In order to develop non-banking financial services, the committee, in line with best international practices has proposed the implementation of the concept of activity based regulatory regime in Pakistan for cluster one entities. In terms of the proposed regime, capital market activities of all entities are to be regulated by the SECP and deposit taking, financing and lending activities of all financial sector participants will be regulated by the SBP....


http://www.pakistantoday.com.pk/2013/03/05/news/profit/secp-unveils-roadmap-for-diversification-of-non-bank-financial-sector/

Riaz Haq said...

Here's an ET report on Elixir Securities CEO's projections for Pak equities:

KARACHI: The sales pitch employed by Elixir Securities CEO Junaid Iqbal to global fund managers at the Pakistan Capital Markets Day in New York last month was simple: even if the incumbent government returns to power after the upcoming elections, the Karachi Stock Exchange (KSE)-100 Index is still likely to post returns of over 21% in 2013.

In case a more pro-business government – supposedly led by the PML-N – comes into power, the stock market will rerate from the current multiple of 6.9 to 7.9, if the projections of the Elixir Securities research team are to be believed. That would push the index to 23,200 points by the end of 2013, which translates into an annual return of 38%.

In the best-case scenario, wherein the new political leadership tries to fix the taxation system in its first months in power, Elixir Securities estimates the KSE-100 Index will likely touch 26,000 points by December 2013, which means a staggering 54.8% annual return.

“The market is operating at an average multiple. In the absence of any leverage, there are no associated risks. It is being driven purely by earnings growth right now,” Iqbal told The Express Tribune in an interview.

Initially planned as a one-day event (hence named the Pakistan Capital Markets Day), Elixir Securities’ two-day road show in the global financial centre was attended by 35 fund managers, partners and principals from 25 major international asset management companies and hedge funds. Elixir Securities also took along representatives from Engro Corporation, Engro Foods, Lucky Cement and United Bank Limited. Iqbal was accompanied by the heads of his research and sales departments.

“All of them wondered how Pakistan’s capital markets could perform so well amidst bombings and violence,” he said, while noting that the KSE remained the third best-performing stock exchange of the world in 2012 by posting 37% returns in dollar terms, despite political instability and frequent terrorist attacks.

“I told them, honestly, that we cannot defend Pakistan on its human rights record: but the fact remains that the annualised growth in profits of the corporate sector for the last four years has been 17%,” he said.

“They understand that a political metamorphosis is taking place in Pakistan. At the same time, they are supremely impressed by the quality of management in our corporate sector,” he added.

Without naming the funds or giving their exact number, Iqbal said many of the companies he interacted with in New York have already consented to visit Pakistan in the near future. He said that it is not possible to state the exact amount of foreign institutional portfolio investment that is likely to come in as a result of his road show, but added that he was confident that investment will soon be coming into Pakistan’s capital markets.

He cited two reasons: firstly, all of the participants, which included some of the largest global funds, had sent their senior team members – something that shows how seriously they viewed Pakistan’s financial sector. Secondly, he noted, they were all ‘knowledgeable investors’ who had already developed deep understanding of issues ranging from the suspension of gas to Engro’s $1.1 billion fertiliser plant, to turf wars in Karachi involving the People’s Aman Committee.

“Pakistan is already on their radar. Our market will skyrocket once the law and order situation improves,” he said.


http://tribune.com.pk/story/517892/elixir-securities-bullish-on-kse-even-if-incumbent-govt-returns/

Riaz Haq said...

Here's a Nation newspaper report on US developer Thomas Kramer (Florida South Beach fame) signing an MOU with Malik Riaz (Bahria Town) to develop islands off Karachi:



Bahria Town and a US investment group signed an memorandum of understanding (MoU) for $15 to 20 billion investment on Monday.

Former Chairman of Bahria Town Malik Riaz and US investment group Thomas Kramer inked the MoU on behalf of their respective companies for the Bodha Island City project.

Under the project Bahria Town in collaboration with the foreign companies associated with prominent US investor Thomas Kramer would construct the world’s tallest building and a number of other projects some 3.5-kilometres off the Karachi shore.

Malik Riaz speaking on the occasion said that if he is given a chance he would make Pakistan into Dubai and Europe, He said that the project would help provide employment to the unemployed and this in turn would help eliminate terrorism. He said that we would continue to invest in Pakistan despite all odds and we are in talks with foreign investors.

Malik Riaz said that he promises the nation that in next few years he would bring foreign investment worth more than Rs 50 billion and no one can stop that. He said that until children are given quality education Pakistan cannot excel.

A spokesman for the Bahria Town said the project called Bodha Island City would be developed within a period of five to 10 years. He said the project would comprise, Net City, Education City, Health City, Port City and other infrastructure projects.

He said the worlds’ most modern shopping mall would also be built on the Island City, which would deal with international brands.

According to reports, the Island City would be linked with Karachi through a six-lane bridge.


http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/national/11-Mar-2013/safe-city-project-malik-riaz-vows-to-bring-more-investment-in-country

Riaz Haq said...

Here's an ET report on Kramer-Riaz MOU:

..American real-estate tycoon Thomas Kramer and Bahria Town CEO Ahmed Ali Riaz Malik signed a $20 billion agreement for Pakistan’s first-ever Island City, Bundal & Buddo Islands, Karachi.

A joint consortium of international investors will join hands to develop this project and the deal with Kramer is the first level of this agreement. Announcement of other global investors from the Middle East and around the globe will be made soon.

Covering 12,000 acres of land, this project will be developed in a span of 5-10 years but the residential communities will start being handed over to people in 2016. The global attractions of the project comprise world’s tallest building, world’s largest shopping mall, sports city, educational & medical city, international city and a media city – all having the most modern facilities and amenities and the most advanced infrastructure.

Island City will be connected to the DHA Karachi via a six-lane modern bridge. The entire city will be a ‘high security zone’, having its own drinking water (converting seawater into drinking water) and power generation plants to enable it to be self-sufficient in electricity.

The project will have mosques, cinemas, spas, golf clubs, school, hospital and other global standard amenities to furnish a modern lifestyle.

Speaking on the occasion, Thomas Kramer said, “I have full confidence in the people and economy of Pakistan. In 1970 when I started my project in Germany it was the worst era of their history. Likewise when Miami Beach project was started, the area was in full control of Cuban criminals, different mafias and gangsters. Dead bodies used to be scattered on the beaches. I completed my projects successfully. Today they are the world’s most secure and advanced regions.

“Current situation in Pakistan is much better than those areas. I am confident that this project along with boosting the economy will also eradicate terrorism from Pakistan. This is a once in a lifetime chance to bring Pakistan back on the map to the leading nations in the world.”
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Thomas Kramer is a visionary businessman commonly known as TK. He surveyed an island hideout of Cuban pirates in 1991-92 and later on developed it into the present day Miami Beach, which is one of the biggest international tourist destinations today. He is specialist in building skyscrapers in coastal areas. His company has successfully constructed several projects around the globe.


http://tribune.com.pk/story/519505/pakistans-1st-island-city-bahria-town-signs-20b-deal-with-us-tycoon/

Hopewins said...

While you were celebrating the announcements of the tallest buildings in the world to be built by Riaz-Shaykh-Kramer in Karachi, here was a THINKING Pakistani economist explaining WHY growth is so LOW and WHAT we need to DO to increase it in the long-term:

http://alturl.com/b49rs

This is EXACTLY what I have been repeatedly trying to tell you, QUOTE:

"A) We require a much higher rate of investment than our average historic rate of less than 19 per cent of GDP and the present rate of just 12 per cent. To generate a growth rate of around eight per cent per annum over a 30-year period will require an investment ratio of 30 per cent plus — the East Asian Tigers averaged 30 to 35 per cent while India is now averaging just under 40 per cent and China 46 per cent.

B) This will necessarily require a sharp increase in domestic savings (less than 15 per cent of GDP for most of our history compared with India’s 35 per cent) to finance the investments needed to attain and then maintain such rates of growth. This large historical gap of four to five per cent of GDP between our investments and savings was financed by external flows, essentially in the form of foreign loans.."

These are the basic facts. Savings --> Investments --> Growth. Is it starting to sink in now? Do you now see why we CANNOT get sustainable high-growth without a concerted effort to raise our savings and investment rates?

Riaz Haq said...

KARACHI: A land grab of monumental proportions is under way not far from the prime strip of real estate along Gizri Creek that constitutes the Defence Housing Authority (DHA), Karachi, Phase 7 (extension) and Phase 8. If all goes according to plan, 490 acres of mangroves across the creek will be incorporated into DHA’s ever-expanding boundaries, following which they will be chopped down, and the area used for the major portion of a lavish waterfront project.

Known as Waterfront Developments, the project has been devised to make huge fortunes for a select few, enormously powerful individuals, while giving short shrift to citizens’ rights and further decimating one of Karachi’s most valuable natural assets, its mangrove forests.

According to a petition filed against it in the Sindh High Court by advocate Mahfooz Yar Khan, the waterfront project involves a deal according to which some of the area will be acquired by DHA on payment while part of the remainder is to be developed by DHA and returned to the owner/s and the rest retained by DHA.

The parcelling out among political and military heavyweights of what should be protected land, and the manner in which the story has unfolded shows an astounding contempt for the law by all concerned.
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The story behind this mangrove forest goes back to 1994, when PPP’s Agha Tariq, then minister for mining, issued a 30-year mining lease for 342 acres (within the 490 acres now earmarked for the waterfront project) in the name of his wife, Gulnar Begum. In July 1996, through BoR Sindh, he had that lease illegally converted into a 99-year lease for commercial/residential/industrial purposes. Then, in September, through his wife, he sold the 342 acres to Marina City Developments, a partnership of businessmen Asif Baig Mohammed and Khalid Masood, and one Seema Treesa Gill.

“We wanted to develop the land into something better than the Dubai Marina, much before Dubai Marina even came up,” said Mr Masood.

According to court documents, the third partner, Ms Gill, was actually Gulnar Begum’s maidservant, an arrangement that gave the former de facto ownership in the 342 acres. In September 2007, Mr Tariq passed away.

There has been decades-long litigation over the 342 acres in various courts with regard to the allotment rate and, after a falling out between Mr Mohammed and Mr Masood, the issue of ownership as well. Court proceedings are still ongoing.

In the last few years another party has staked its claim to part of the 342 acres based on an agreement with one of the two businessmen. That case is also in the superior courts.

http://www.dawn.com/news/1140437/karachi-a-goldmine-for-land-developers

Riaz Haq said...

Investors snap up #Pakistan's first real-estate investment trust (Dolman City #REIT); Will boost #Karachi real estate http://on.wsj.com/1GyBSdX

Investors piled into Pakistan’s first real-estate investment trust, which was launched this week with a public offer that was heavily over-subscribed, the REIT’s lead manager and analysts said on Thursday.

The Dolmen City REIT offered investors a 25% stake in a 22.24 billion rupee ($218.5 million) shopping mall and an office complex at Dolmen City, one of the most prominent real estate developments in Karachi, Pakistan’s largest city and its economic hub. The Arabian Sea-front project includes three other structures not included in the REIT.

Traders and the REIT’s main advisor said the initial offer for 75% of the trust to institutional investors and high net-worth individuals through bookbuilding on Monday and Tuesday drew demand of more than 7 billion rupees for an offering of shares worth 4.17 billion rupees at a floor price of 10 Pakistani rupees ($0.10). At the strike price, the initial offer raised 4.59 billion rupees, according to the REIT’s lead manager.

The remaining 25% of the stake was to be offered to the public on Friday at a strike price of 11 rupees ($0.11). Analysts and the REIT’s management expected the Friday offering to be fully subscribed as well, raising another 1.53 billion rupees.

“The interest rate is at a 42-year low, with the discount rate at 7%, so for people who invest in fixed-income instruments, REITs are attractive,” said Muhammad Tahir Saeed, deputy head of research at Topline Securities, a Karachi-based brokerage.

Pakistan’s economy has improved in recent years, despite political turmoil, major security challenges, and chronic electricity shortages that have hobbled industry. The country’s main stock market in Karachi has gained 72% since the 2013 election and the country’s improving prospects are increasingly being recognized internationally. Prime Minister Nawaz Sharif’s government has said boosting investment is one of its key economic objectives.

With both buildings in the Dolmen City REIT fully occupied, it is expected to yield 9.5% in the first year, with a 10% increase every year based on escalation clauses in tenancy agreements. The development is located next to two of Karachi’s most affluent residential areas.

The Dolmen Mall Clifton, Pakistan’s largest shopping mall, currently has an occupancy rate of over 90%, according to a fact sheet provided by the REIT management. The mall has 130 stores, including foreign outlets such as Debenhams DEB.LN -1.13%, and a multi-level department store.

The neighboring Harbour Front office complex is currently fully occupied, with several high-profile tenants like Procter & Gamble and Engro, one of Pakistan’s largest corporations.

Pakistan’s commercial property sector was described in a first-quarter report this year by Lamudi Pakistan, an online real estate portal, as “almost at a standstill”. But analysts said investors in Pakistan are still keen on real estate as a long-term asset, particularly in properties such as Dolmen City’s Harbour Front with high-profile corporate tenants.

“In the long term there are significant opportunities as prices are low, meaning potential yields are high, and there is considerable room to expand and modernize Pakistan’s stock of commercial real estate,” BMI Research said in a report on the country’s real estate sector earlier this year.

Analysts said the success of the Dolmen City REIT could boost interest in the instrument.

“People were looking at Dolmen and expecting that, if it succeeds, many REITs will be launched in the coming years [in Pakistan],” said Saeed of Topline Securities. “I can foresee some groups [developing shopping malls] jumping into this asset class.”

http://blogs.wsj.com/frontiers/2015/06/12/investors-flock-to-pakistans-first-real-estate-investment-trust/

Riaz Haq said...

New UBL Tower Karachi is the new bank headquarter of United Bank Limited in Karachi, Pakistan. United Bank Limited (UBL) has just finished the construction of its head office in Karachi.

A 22 storey glass structure, 2 towers internally connected with 5 bridges? Wow. That's #UBLHeadOffice, a new #IconicLandmark in Karachi

According to UBL, this landmark represents the progressive and innovative past and the future of the bank. It is indeed a one of a kind high rise built by a banking company in Pakistan. The city’s skyline looks more lively with UBL’s new building towering over other commercial buildings in the area. https://propakistani.pk/2016/12/19/ubl-moved-headoffice-stunning-twin-skyline-karachi/

Riaz Haq said...

THE EXPRESS TRIBUNE > BUSINESS
Egyptian billionaire ventures into Pakistan's real estate with $2b project
By Bilal MemonPublished: December 22, 2017

https://tribune.com.pk/story/1590668/2-egyptian-billionaire-ventures-pakistans-real-estate-2b-project/

Pakistan is set to see a new real estate venture – this time in the federal capital – as demand for housing keeps motivating projects across different parts of the country.

The $2-billion project, named Eighteen Islamabad based on its location, was formally launched in Islamabad on Friday and is a partnership between Egypt-based Ora Developers and Saif Group, the Pakistani conglomerate with business interests largely in textile, energy and real estate sectors. Additionally, Kohistan Builders and Developers is also partaking in the project.

Spread across 2.77 million square yards that will also feature a 18-hole golf course, the project will look to sell over 2,000 residential units – 1,068 villas of different sizes and over 900 apartments – along with commercial properties, meant to serve the upper-middle income groups.

The project also brings Egyptian billionaire Naguib Sawiris back to Pakistan after Orascom Telecom Media and Technology Holding, in which he has a majority stake and is also the chairman, had acquired Mobilink before the company sold its stake to VimpelCom.

Sawiris, however, is now on a different mission to Pakistan.

“I was here around 20 years ago when we started Mobilink,” said Sawiris, the chairman of Ora Developers, as he addressed a gathering of journalists at Serena Hotel.

“We wanted to continue our business in Pakistan and as we ventured out of telecom we thought of real estate development because I was horrified at the prices people were paying for villas and apartments in Islamabad,” he continued, referring to the phenomenally high prices of real estate in Pakistan that have continued to shoot in the last few years.

According to a World Bank estimate, there is a shortage of 10 million housing units in Pakistan, a deficit that continues to grow in urban areas. With population growth at 2%, the shortage will keep piling.

Sawiris said his aim would be to expand to other cities including Karachi and Lahore, but the challenge would be to find land in the provincial capitals.

“Land availability is the biggest issue facing the real estate sector in the country. Until the issue is resolved, challenges will remain.”

The $2-billion project features a 30% component of equity, to be injected by the investors, along with a 30% stake to be financed with major banks in Pakistan. Talks of these modalities are ongoing, said Eighteen Islamabad Chief Executive Officer Tarek Hamdy.

He also said no-objection certificates have been obtained from the Capital Development Authority in Islamabad and transfer deeds will be given to buyers since Eighteen Islamabad owns the land already.