Pakistan unrest deterring investment
Construction companies claim confidence has been shaken by political turmoil in the troubled country.
Construction companies claim their confidence in investing in Pakistan has been shaken by the political turmoil in the country.
Earlier this month, Pakistan's President General Pervez Musharraf, declared a state of emergency in the country after dissolving the government and arresting senior government officials.
But economists have warned that any long-term political instability could have an effect on outside investment in the country.
In recent years, Pakistan has seen a huge amount of investment from GCC countries.
Recent figures suggest that the UAE could invest US $50 billion (AED183.5 billion) within the next few years.
Many companies, including Emaar, the Giga Group and Limitless have announced projects for the area. Now with the threat of sanctions and expulsion from the Commonwealth if democracy is not restored, many believe that investors could look elsewhere.
Ani Ray, director, Simplex Infrastructure, told Construction Week he believed there could be some long-term effects from the problems in Pakistan.
"There have been a number of delays because workers will not be turning up to work," he said. "It will mean that a number of projects will miss their deadlines, but I doubt that any projects will be shelved.
"Many companies will think twice about investing in Pakistan because of the turmoil. But I think this will only be in the short-term - maybe three to six months - because the turmoil will go."
The Giga Group is building projects worth $330 million in Pakistan, in conjunction with the Al Ghurair Group.
These include the residential high-rise towers Goldcrest DHA Islamabad and Platinum Square at the World Trade Centre and the 443 Keys five-star hotel.
The group has also teamed up with Emaar Properties to develop the $2 billion Crescent Bay, a 108-acre development in Karachi.
Giga Group spokesman Naveed Pirzada said it was too early to see how the projects would be affected, but said many of them had been unaffected by the trouble.
Limitless, one of the Dubai World companies, has also been lining up a number of projects in Pakistan.
Spokeswoman Rebecca Rees said the ongoing crisis was not deterring this planning stage.
She said: "Limitless continues to closely monitor and assess all of its markets, including Pakistan, and remains positive about its plans for the country."
A spokesman for the Pakistani Consulate in Dubai reassured investors that they should not worry about investing in the country.