Unprecedented hike in prices of building materials, bricks, cement, steel, crush, sand, sanitary fittings, pipes, electric wires etc have badly hit the construction industry shattering hopes of at least 60 percent Pakistani house -holds to build a pucca house in their life time.
According to a recent survey the construction cost of a five marla or a ten marla house has been doubled in six months in the provincial capital. Prices of Kiln baked bricks have shot up by almost 100 percent from Rs. 4000 to Rs. 7800 per thousand after levy of 16 percent GST on bricks that kiln owners have refused to pay.
Price of another essential building material cement has spiked up to Rs. 420 - 430 per 50 KG bag, an increase of Rs. 100 per bag due to what cement manufacturers claim increase in input costs and recession in the housing and construction industry.
The rate of ordinary grade steel used in laying roofs, basements and other structures, had also increased to Rs 75,000 per ton from the previous retail price of Rs 55,000 per ton.
Similarly suppliers of sand and crush have also increased prices of their material by about fifty percent.
Experts of construction industry say that housing and construction sector is the second largest job provider to unskilled daily wagers who are facing untold financial hardships after alarming decline in the construction/building activities.
They said it is an irony that the government has identified Housing & Construction Sector among the driver of economical growth as not less than 60 industries are linked to this sector, yet the present Federal and provincial governments have taken no step to check the increase in prices and activate this sector.
According to a World Bank report if the current shortfall of nearly five million proper housing units persists in Pakistan it would lead to new slums in major cities, already a grave problem due to continuous migration of population from rural areas to the urban centres in search of jobs.
Economic experts say that in the current economic scenario, a part of economic revival depends on investment in housing sector: a significant avenue for banks financing and household investment and a factor in long-term economic growth.
A businessman Samiullah Durrani told Business Recorder that the government's persistence to levy GST on rural based kiln owners has aggravated the situation, as the kiln owners have increased prices of bricks without paying any tax to the government. He suggested that the government should reduce duties and taxes on building materials including bricks, cement etc. and advance liberal loans through House Building Corporation to reactivate construction and housing business in the country.
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