ISLAMABAD: The federal government is preparing a wide-ranging reform package aimed at revitalising Pakistan’s construction industry, improving regulatory oversight and attracting greater investment in modern infrastructure.
The proposed measures include the establishment of a Construction Industry Development Board (CIDB), consideration of a specialised Construction Development Bank (CDB), targeted tax reforms and changes to import and export policies.
The proposals were discussed during a high-level meeting chaired by Federal Minister for Economic Affairs and Establishment Division Senator Ahad Khan Cheema. The meeting brought together senior government officials, representatives of the Construction Association of Pakistan and other stakeholders to examine the sector’s financial, regulatory and operational challenges.
Under the proposed framework, the CIDB would promote the development of the construction industry while also regulating contractors, consultants and industry standards. The body would include representatives from both the public and private sectors and would seek to establish more consistent construction standards across the country.
Senator Cheema said the government and the Construction Association of Pakistan were in agreement over the need for a dedicated regulatory and development body. The proposed framework will be presented to Prime Minister Shehbaz Sharif for approval.
The government also plans to introduce targeted tax incentives and rationalise import and export policies to encourage the use of modern construction technologies and strengthen local production capacity.
In a significant move to improve the quality and durability of public infrastructure, the standard Defect Liability Period for public development projects is expected to increase from one year to three years, with a longer-term plan to extend it to five years.
The proposed reforms would also increase accountability for consultants. Unlike contractors, who can face penalties for poor performance, consultants currently have limited direct legal accountability. Under the new framework, consultants could be subjected to regulatory oversight and held financially and legally responsible for design defects and technical errors.
The government is also examining the construction industry’s difficulties in obtaining financial and performance guarantees. Senator Cheema directed Minister of State for Finance Bilal Azhar Kayani to consult the State Bank of Pakistan and Pakistan Banks Association on these issues and assess the feasibility of establishing a dedicated Construction Development Bank.
The government says the reforms are intended to ensure that public infrastructure projects deliver better value for money, remain durable and meet higher technical standards. Officials believe stronger regulation and accountability could reduce disputes, improve construction quality and bring Pakistan’s industry closer to international standards.
