Drop In Violence Hikes Property Price In Karachi
Property prices rise in Karachi
NEW DELHI: Pakistan’s port city of Karachi has a bad reputation as violence driven by militants, gangs and even petty criminals became part of everyday life. In the last few months, however, a decrease in violence has sent the city’s property market soaring, with those who bought property in Karachi during the period of intensified violence now cashing in.
“Karachi’s market, especially, has us on the edge of our seats,” Zeeshan Ali Khan, chief executive officer of Zameen.com -- which claims to run Pakistan’s largest property website -- told Bloomberg. Sales have “grazed peak after peak” following the security operation, he said.
Khan’s excitement is translated into fact as property prices have been growing faster in Karachi than in any other major Pakistani city this year. Average property prices in Karachi increased 22 percent to 7,234 rupees ($70) per square foot in October compared with a year earlier, according to Zameen.com. By contrast, real estate prices rose 14 percent in Lahore and fell 5.5 percent in Islamabad, the capital.
This directly relates to the fact that police have counted 68 murder-free days from August 2014 until early December, and the average number of daily killings dropped from seven to four. The decrease in violence has been made possible, in turn, by a security operation that began in late 2013. This is good news for Pakistan not just because of the growth in the property market in Karachi, but because Karachi generates about half of Pakistan’s tax revenue and is home to the country’s stock exchange and central bank.
The decrease is encouraging after Karachi witnessed its worst year yet in 2013, with figures released by the Sindh Police Department placing the numbers killed at 2715. The Department stated that 9229 targeted raids were carried out in 2013 in which 13906 alleged criminals were arrested.
In the same year, sectarian violence increased by 53 percent in Pakistan, according to a report released by the Pakistan Institute for Peace Studies (PIPS), with 85 percent of sectarian violence attacks and 68 percent of people killed in such attacks concentrated in Karachi, Quetta, Gilgit and Kurram Agency. 2013 was witness to 132 sectarian related attacks in Karachi, in which 212 people lost their lives. The close ties between the banned sectarian group Lashkar-i-Jhangvi (LJ) and the TTP reflects the dangerous nexus of sectarian and militant outfits in the city.
In addition to militant and sectarian groups, Karachi is home to hundreds of gangs involved in organized crime. Lyari, an ancient town in Karachi, emerged as an epicentre of rival gang warfare with groups such as the Rehman Dakait Group, the Arshad Pappu Group, amongst others, operating in the area.
The activities of these outfits has led to the emergence of a volatile situation, threatening stability in a city that earns 60-70% of Pakistan’s national revenue. The expansion of militant groups also has political implications, with secular parties, especially the anti-Taliban Awami National Party (ANP) and the Muttahida Quami Movement (MQM), standing the most to lose. The most worrying aspect of the operations of militant, sectarian and criminal groups is the impact on civilian life, evinced by the numbers killed in violence-related incidents in the city.
The Pakistani government has pointed to the violence in Karachi as a matter of concern several times, with Prime Minister Nawaz Sharif commending the Rangers and expressing a commitment to ongoing operations till peace and security are restored to the city. Other political parties and groups, including the Pakistan People’s Party (PPP), Awami National Party (ANP), Jamaat-e-Islami (JI) and Jamiat Ulema-e-Islam (JUF-F), have expressed their support for state-led targeted action.
However, government action has come under widespread criticism, with the Human Rights Commission of Pakistan (HRCP) stating that addressing the violence in the city does not appear to be a priority for the government. Analysts point to a systemic issue in Karachi: the fact that most stakeholders, including political parties, have ties to militant outfits operating in the city. The government’s dual action of targeted operations coupled with the willingness to engage in dialogue with militant groups has come under criticism as a strategy, with the government’s resolve to curb violence being questioned.
2015 has shown some encouraging signs, but as they say … don’t count your chickens before they hatch.