By Ayesha Mudassar

ISLAMABAD, July 4, (INP-WealthPK): The construction industry of Pakistan needs incentives to attract domestic and foreign investment.

Junaid Alam, the managing director of Gold Land Estate and Builders, told WealthPK that new taxes measures in the budget for the financial year 2022-23 would discourage investors and affect the growth of construction industry.

He said that the stimulus package provided by the previous government to the construction industry created employment opportunities and increased investment in the sector. He said that tax breaks and low interest rate encouraged people to invest in real estate.

Junaid Alam said that construction industry play a vital role in the development of the economy. He added growth of construction sector fostered development of allied industries.

Danish Ahmad, the sales manager of AAA Associates Real Estate, told WealthPK that the prices of construction materials increased exorbitantly due to the current inflation and increase in the value of dollar in the market.

He said that the revenue of the global construction industry was anticipated to increase steadily in the coming years. The size of the construction market amounted to $6.4 trillion in 2020. It is expected to reach $14.4 trillion by 2030.

Globally, the construction sector consists of civil engineering, infrastructure projects and real estate. Increase in private sector investments, technological development and rising disposable income are expected to propel the growth of the market.

Steel, cement, bricks, aluminium, cables, fixtures, glass, kitchen and bathroom fittings, marble, paint, ceramic tiles, transportation, warehousing and wood all contribute to the construction sector, which employs 7.61 percent of the overall workforce.

The main drivers of demand in the construction sector are Public Sector Development Programme (PSDP) spending on uplift projects, followed by private investments.

The majority of the construction revenue comes from government contracts, ranging from buildings of infrastructure to highways. With the launch of China-Pakistan Economic Corridor, the growth of the construction sector has gained momentum. The government relief packages and subsidies also help in growth of the industry.

The construction of private and residential buildings and housing units is also an important driver of the sector, particularly in rural areas. Along with population growth, there is an increase in demand for residential accommodation in the country.

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