Access To Shelter

3. The Pakistan Situation

Income Groups And Housing Supply

Broadly speaking there are four income groups in Pakistan. The higher income group (HIG), the middle income group (MIG), the lower middle income group (LMIG) and the lower income group (LIG). The manner in which they acquire shelter differs considerably.

The HIG invariably acquires land in posh colonies which are strategically located with easy access to city centres and which have fully developed physical infrastructure. Almost all high income housing in Pakistan consists of individual houses built on plots larger than 600 square yards. The houses are custom built by contractors, financed by bank loans and designed by architects. Middle income housing is also invariably custom built but is usually not designed by architects and often does not have easy access to the city centres. The Infrastructure, especially roads, is badly maintained. Contractors build the middle income houses but increasingly this group is turning to developers for providing housing to it, especially in the larger cities of Karachi, Lahore, Rawalpindi, Faisalabad and Hyderabad. This group manages to access loans from the HBFC and commercial banks.

The lower middle income group faces a number of problems. Its financial limitations make it difficult for it to access plots in locations that are near the city centre or employment zones. Accessing HBFC and other bank loans is also difficult unless there is a collateral in the form of land which is becoming increasingly expensive due to the demand of the elite and middle classes. As a result, the LMIG is turning to the developers in the urban areas for providing housing through town houses and apartment complexes. The developers also arrange loans for the applicants from the HBFC or other housing banks. This frees the shelter seekers in this group of searching for a plot and going through the time consuming and torturous process of building a house. However, developers do not always deliver on time and much of their construction is substandard. To protect themselves against the developers, house and apartment owners in a complex usually form an association and collectively deal with the developers to ensure quality and on time delivery.

The LMIG has other problems as well. A large number of people of this group cannot afford to purchase formal sector housing. At the same time, given their social status they are hesitant to live in a katchi abadi or in an informal settlement. When they are forced to move to an informal settlement they feel socially degraded.

The vast majority of the lower income groups in the urban areas of Pakistan have no option but to settle in unserviced katchi abadis or in unserviced informal settlements created by the subdivision of agricultural land. The formal sector developers do not cater to their needs because they consider dealing with the poor to be problematic. Also, profit margins are limited and there are no government subsidies to increase their profit or to make the end product affordable to the poor. In the katchi abadis and informal settlements developed by informal developers, people build their houses incrementally and acquire services through a process of lobbying with government officials and politicians. The manner in which these two types of informal settlements develop is illustrated in Box – 2: The Katchi Abadi of Yakoobabad and Box – 3: The Informal Developers of Faisalabad. In the rural areas, conditions are worse. Most of the rural population consists of landless labour. They can only acquire a place to live if they can perform some service to a landlord or become his tenant farmer. In many cases, families have become bonded labour simply to acquire a place to live1.

It is estimated that 9 million people live in katchi abadis in Pakistan and 15 million in informal subdivision of agricultural land. The number of people living in temporary settlements in the rural areas or in inner city slums has yet to be calculated. This means that well over 50 per cent of Pakistan’s urban population lives in informal settlements2.

Box – 2:  The Informal Subdivisions of Yakoobabad

Yakoobabad is a katchi abadi of about 2,000 houses in Orangi Township. Before 1977, it was vacant land belonging to the Central Board of Revenue (CBR). The CBR had given it on a renewable one-year lease as pasture land to an elder of the Rind tribe (henceforth referred to as X).

Mr. Y is one of a number of informal developers who have illegally developed more than 200,000 plots on government land in West Karachi alone, over the last 30 years. Like other developers he has close links with officials in the CBR, Karachi Metropolitan Corporation (KMC), police and other departments relevant to his work.

In February 1977, Y moved onto X’s land with 100 “destitute” families. These families were transported in trucks along with bamboo posts and mats (supplied by Y) for the construction of shacks. Y had identified these families through his contacts in the settlements he had created earlier. As soon as the families started putting up their shacks, members of the Rind tribe arrived in jeeps carrying guns and tried to eject them. A scuffle followed and a number of Y’s people were injured. It was decided between the two parties that no houses would be put up but the “destitutes” could stay on the land until matters were settled.

The next day X hired a lawyer and made a case in a court of law against the occupation of his land. The case was admitted. Y on the other hand, filed a complaint with the local police saying that the Rind tribe had caused “bodily harm” to his clients. After this the local thana (police station) arranged negotiations between the two parties. As a result, it was decided that the Rind tribe would receive Rs 500 for every plot that was developed by Y. The plots being given to the 100 “destitutes” were exempt from this payment and Y also did not receive any payments for them. It was further agreed that Y would pay Rs 200 per plot to the KMC officials from the sale proceeds and that the police would recover Rs 200 or more directly from the owners when they converted their shacks into concrete wall constructions. After the negotiations were completed, the Rind tribe withdrew its case against Y.

Y then laid out Yakoobabad on a gridiron plan. His apprentices (he was also an apprentice once) helped him in this work. The roads were levelled by informally hiring tractors and a bulldozer at a nominal cost from KMC staff in West Karachi. Space for a mosque and a school were set aside and plots on the main road were allocated for shops and businesses. At this stage negotiations were entered into with representatives and touts of government officials who could be of help in the future development of the settlements. 30 per cent of all plots were set-aside for these officials for speculation purposes. Whoever purchased a plot in the settlement (except for the ones reserved for officials) had to construct a house in a month’s time and move in, failing which he would lose his plot and the money he had paid for it. Thus Y prevented speculation and saw to it that the settlement would expand fast.

X appointed a chowkidar (caretaker) to keep track of the number of plots that were developed so that Y may not cheat him. In the same manner, the KMC officials also had their informal representatives visiting the site regularly. Accounts were settled between the parties every week.

Y engaged donkey cart owners to supply water to the settlement. These suppliers acquired water illegally from the KMC water mains in Orangi. The payment of the first supply of water was made by Y, after which the people dealt with the water suppliers directly. A few weeks after the first shacks were built, a contractor, Nawab Ali, established a building component manufacturing yard, or thalla, in the settlement. He started supplying concrete blocks and tin roof sheets for the construction of houses along with technical advice and small credit. As such, he became the architect and the HBFC to the residents of Yakoobabad. He also constructed a water tank for curing purposes and this tank became a source of water supply for which the residents paid. In the initial ten-year period, 92 per cent families had built their homes with support from Nawab Ali and 62 per cent had made use of the credit offered by him. At the same time as Nawab Ali, another entrepreneur, Faiz Mohammad Baloch, moved into the area. He set up a generator and started supplying electricity to the residents at the rate of Rs 30 per tube light or a 40 watt bulb. This sum was to be paid in advance and an advance non-payment for the next month would lead to a disconnection. Later Faiz Muhammad Baloch opened a video hall where three films per day were advertised and illegally exhibited to an audience of about 20 to 50 people per show. The local thana permitted this and received bhatta (illegal gratification) for their support.

Y has formed a welfare association of all the households who have ever purchased a plot from him. This association is a legal person registered under the Societies Act. The Yakoobabad families became members of this association and through it Y and the Yakoobabad leadership have lobbied for infrastructure and improvements in the settlement. In this they have been helped by officials and politicians, who hold plots in Yakoobabad, since all improvements increase the value of property.

Most of the early residents of Yakoobabad were people who owned no homes or who could not afford to pay rent. Later residents came to Yakoobabad to escape from degraded physical, social and environmental conditions in the inner city. By 1989, Yakoobabad had become a “proper” settlement and even lower middle income families started to shift here and as a result, the physical and social environment of Yakoobabad underwent a major improvement.

Today, 60 per cent of Yakoobabad has electric connections (acquired through the bribe market) and the rest of the 40 per cent either buy electricity from their neighbours or illegally tap the Karachi Electric Supply Corporation (KESC) mains by paying the KESC staff. There is still no piped water although water mains and trunk sewers under an ADB financed project have been laid. However, water now comes through tankers and not by donkey carts. The area has 10 primary schools, 2 secondary schools, 6 clinics and many roads have been paved by the councillors. The education and health facilities are all in the private sector. Transport through mini buses and Suzuki pickups is available. In addition, 401 micro enterprise units provide employment to over 2,600 persons in the settlement. Most of the units are engaged in garment stitching and zari (golden work on cloth) work and employ women. Nawab Ali has shifted his thalla to a newer settlement and Faiz Mohammad Baloch has become a video shop owner. A plot that was sold for Rs 900 in 1978 now fetches a price of over Rs 30,000.

The people of Yakoobabad have paid far more through bribes and extortion for their land and its development than they would have for a government developed housing scheme. But, they have paid for this incrementally over time and in sums that were affordable to them. In addition, this struggle to improve their conditions has transformed them into a community.

There are over 700 settlements like Yakoobabad in Karachi, housing more than 50 per cent of the city’s population. They grow at a rate of 9 per cent per year against an annual urban growth rate of less than 4 per cent. It is they, and not the state agencies, that are determining the future physical, social and political structure of the city.

Source: Research by the author

  1. Ercelawn, A and Nau­man, M: Unfree Labour in south Asia: Eco­nomic and Polit­i­cal Weekly, Delhi, May 2004
  2. Hasan A: Hous­ing: Lessons from How the Urban Demand-Supply Gap is Met in Pak­istan: paper read at the IAP National Sym­po­sium on Hous­ing, Lahore, Jan­u­ary 2004

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