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Construction the mother of many industries

There is an old saying ‘construction is the mother of many industries’ and it seems true even today. To begin with, it employees the largest percentage of unskilled labor, consumes cement, steel, wood, glass, tiles and sanitary fittings. Domestic consumers are also the biggest consumers of gas and electricity. Therefore, it may be said that if the government is serious in accelerating the GDP growth rate of the country, it hconsas to facilitate the construction industry. If one adds construction of infrastructure, it becomes trillions of rupees industry that demands proper attention of the government.

Let first of all split construction into infrastructure projects and residential projects and then explore the potential of each segment. The bulk of the infrastructure projects: dams, bridges, roads, under-passes and overhead bridges are constructed by the federal and provincial governments. Every year the government allocates billions of rupees but actual spending remains paltry. If the government faces budget deficit the first axe falls on the Public Sector Development Program (PSDP). This not a secret, but has been happening year after year.

While paltry spending on the infrastructure projects is known to many, but very few people know that the concerned government departments also suffer from lack of capacity to undertake mega projects. This inadequacy leads to delays, hike in cost, poor quality and on top of all massive misappropriation of funds. One of the most evident example is ‘Natives Jetty’ bridge. Nearly 150 year old railway track is still in use and bridge used for other types of traffic has become part of ‘Port Grand’. A bridge was constructed at this point in the seventies, but has to be demolished after two decades as it was declared ‘unsafe’. Another bridge and a flyover has been constructed to handle the ever growing traffic, particularly coming/going to the seaport and SITE.

Work on China-Pakistan Economic Corridor (CPEC) has started which includes construction of motorways, bridges and power plants. This is likely to bring a boom in the construction industry, boosting consumption of cement and steel. The respective industries have already undertaken expansion plans. CPEC is likely to major source of employment for unskilled/semi skilled workers. However, some experts fear that Chinese contractors may bring their own cement and steel as well as the workers. This may be a big challenge, but it could be met if required steps are taken by the government and the local contractors.

Along with the roads, construction of domestic housing units and warehouses is being anticipated. It is on record that the post harvest losses range from 15 to 40 percent for different crops. This happens mainly because of the poor logistic and warehousing facilities.The government has already embarked upon Warehousing Receipt Financing Program, which envisages the construction of warehouses of international standard.

There is a visible change in the construction of residential units. Previously houses had ‘load bearing walls’ but now multi-story buildings are being constructed having concrete structure. As a result, demand for steel, cement, tiles, pipes for drinking and sewerage water is on the rise. However, a point of concern is that smuggling of tiles and bathroom fittings is on the rise, which is causing slow and gradual death of the domestic manufacturers.

As the cities are expanding the demand for public transport is also on the rise. During the PML-N regime, various types of public transport schemes, orange and green lines are being constructed. This has boosted demand for steel and cement. The only regret is that Pakistan’s only steel mill, operating in the public sector, has stopped production. Neither it has been privatized nor any revival program is being offered. Another steel mill that started with a big bang could not be run and has added to the bad debt of local banks.

One of the industry that has been able to cater the demand is sheet glass manufacturers. Now glass sheets are available in different colours and beautiful designs. However, it is necessary to mention that Pakistan has not been able to develop its glass industry, despite having huge reserves of limestone and silica sand. It may not be out of context to mention that use of glass bottles is on the decline due to soft drinks packed in cans and other liquid sold in PET bottles.

There is also a dire need to segregate construction business, particularly that of housing units. Ironically, the key activities, marketing, development and construction are being done by the builders themselves. They have not started outsourcing, which adds to the cost of construction. The builders have to make huge investments in shuttering and scaffolding.

The emergence of ‘ready mix’ suppliers is a positive development. It has helped in containing spreading of building material around the sites. However, there is a need to improve quality of the bowers as the spill over causes serious traffic hazards.

According to the experts, builders often violate ‘building by laws’. While many succeed in regularizing the revised plan, many of the incomplete building shows the apathy of builders as well as the overseeing authorities. It is disgusting to note that the regulating authorities keep their eyes closed till many floors of the building have been constructed. Suddenly they wake up and demolish some parts of the building and work is stopped for an indefinite time.

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