November issue 2006

By | News & Politics | Published 13 years ago

“Fire of creativity and imagination is promising to make the Karachi beach front a much sought-after tourist destination in the foreseeable future. Entirely practical and wholly reliable projects will have a deep impact on the lifestyle of the people of Karachi whose perception of enjoying the sea at present consists of riding a camel or a horse, or just taking a walk on the wet sand and watching the waves crash on the shore,” says a promotional advertisement on the website of Karachi’s Defence Housing Authority (DHA).

Long-winded though the ad is, it doesn’t even begin to tell the real story. Internal maps for the ‘development’ of the 14-kilometre-long beach strip seen by Newsline — and which begins at McDonald’s Seaview and encompasses the entire beach front up to Phase VIII — which have been leaked out to various property dealers, indicate how Karachi’s existing beach front has been carved into thousands of new plots for the armed forces.

The developers, meanwhile, have been given permission to reclaim the seabed for their projects. In the case of Emaar, the main developer involved, reclamation stretches as far as half a kilometre into the sea. On this reclaimed land are planned luxury apartments, office buildings, restaurants, hotels, an ice skating rink, water parks and piers for luxury boats and yachts — an awesome collection of upscale facilities suited to the lifestyles of the rich and famous. Thus, while the government claims that 80 per cent of the 14 kilometres earmarked for these ‘development’ projects is for the benefit of the public, it doesn’t explain how the public will muster the resources to access these essentially luxury facilities.

The DHA has given 75 acres of the beach in DHA Phase VIII to Emaar, a UAE-based development giant. The developer has named the project Crescent Bay and work has already commenced. Hundreds of trucks laden with heavy boulders enter the city daily and dump their cargo into the sea to reclaim even more land than has already been reclaimed, at great ecological peril.

The developers of the company owned by Sheikh Mohammad, have, according to inside sources, already reclaimed at least 109 acres. On this land, Emaar is set to build 4,000 luxury apartments, a mall and a five-star beach front hotel. The entire area, which includes the beach, will be off-limits to the public — unless they have the bank balance to utilise what is on offer. The exclusive nature of this development was made very clear recently at a briefing about the Crescent Bay project for a select group of investors from Karachi. The foreigner who was giving the briefing emphasised more than once the benefits of the project’s “private beach.”

What is even more private, however, are the terms under which the beach front has been bartered. Unlike the sale of precious property abroad, and close to home in the UAE, here, the details of the tenders the government claims to have floated, and those of the bank guarantees that are usually associated with transparent transactions, are shrouded in secrecy.

The question is, does the DHA have the authority to sell beach front property in the first place? According to the Sindh government, the DHA owns certain segments of the area facing the beach, not the beach itself.

Therefore, the multi-million dollar question is, who owns Pakistan’s coastline? Legally, it’s the Sindh and the Balochistan governments. However, since the DHA is run by the army, the Sindh government is helpless and seems to have no option but to watch silently as their land is usurped and sold.

So neither does the DHA own the beach nor does it have the power — legally that is — to allow reclamation of land along the beach. While there is, so far, no hard evidence to suggest that a sizeable amount of money has changed hands to award prime stretches of Karachi’s coastline to foreign investors, endless rumours are circulating about multi-million-dollar under-the-table agreements with DHA officials and prospective developers. What is confirmed is the fact that the DHA has doled out the beach front without charging a single penny, contending that once developed, the investors will share the profit with the Authority. Interestingly, investors will have the right to collect loans from financial institutions by pledging this land, for which it has not paid a penny to date.

A few months ago, a senior Pakistani banker was shocked when private investors approached him, seeking 50 million US dollars to build high-rises on the beach. “I asked them who owned the land. They said, ‘The DHA.’ They then explained that they had been allowed to build skyscrapers there and had been given permission to obtain loans from the banks. I wondered what the bank’s collateral would be. How could I give a loan to people who had probably not even built their own houses, who didn’t own the land and wanted access to public money? So I showed them the door, telling them that once they had clear title to the land, the bank would help them out,” disclosed the banker.dha-2-nov06

The DHA’s decision to barter the strip of beach has, in fact, created lot of ‘briefcase businessmen.’ Typically, new tycoons are the sons and sons-in-law of retired intelligence officials, leaders of the city’s underworld, and the high and mighty of Pakistani politics, who frequent the Far East and Middle East in order to get any ‘investor’ with a presentable bank balance to front the money, secure the projects in Karachi and make some quick money for themselves.

As dubious as the beach front affair is, however, it is just one among others currently unfolding. The Port Qasim Authority (PQA), for example, has decided to sell two of the islands under its control, Bundal and Buddo, also to Emaar. The islands, which can be seen from Defence and Korangi on a clear day, measure about 12,000 acres in total and were sold for a paltry 400,000 rupees per acre. At the moment, access to the islands is only by boat, and so, a 50-million-dollar bridge is being built by the federal government. Essentially, while Karachi, the country’s economic hub, lacks even basic infrastructure, the government has seen fit to squander taxpayers’ money for the benefit of a few.

If that were not bad enough, Islamabad has now decided to give the historical 2.5-square-kilometre island of Manora to Nakheel, another UAE-based mega-construction firm. According to sources, the memorandum of understanding (MOU) has been signed between the government, the Karachi Port Trust (KPT) and Nakheel.

Most of the details of the agreement with Nakheel are secret, but senior government officials say that Nakheel will compensate the port and the navy for the loss of its assests from Manora and will also compensate the people who own properties on the small island.

Nakheel’s plans are, unsurprisingly, not much different from those of Emaar. The firm proposes to develop Manora as a private residential and commercial mini-city with its own private beach. There is also a plan to build a huge bridge connecting Manora to Clifton, so that its privileged residents will be spared negotiating the port traffic.

Interestingly, long before the decision to sell Manora Island was made public, the land mafia in Karachi had been buying huge chunks of land in and around Hawkes Bay. The moment a bridge connects Clifton with Manora, the area around Sandspit, Hawkes Bay and thereabouts will turn to gold, as the driving time from Clifton or Defence to Hawkes Bay via Manora, free from traffic congestion, will be substantially reduced.

According to sources, for the last two years, private cartels from South Africa, Dubai and Mumbai have been pumping billions of rupees into real estate in Hawkes Bay and in the process, encroaching on poor villagers’ land on the coastline.

dha-3-nov06Everyday, thousands of people, including both Karachiites and visitors to the city, come to Keamari pier, hire a boat for as little as 10 rupees per person and visit the island of Manora. Most of these tourists have no idea that in the next few months this little pleasure will be lost forever, as Manora becomes out of bounds for the public.

Locals, however, are painfully aware of the situation. While the property owners will be handsomely compensated, there are many residents, including hundreds of boat owners, who don’t own anything. They decided to settle on Manora and the nearby island of Bababhit because their ancestors either worked for the port or were linked with it in one way or another. For them it will be the loss of a way of life. But policy makers in Islamabad obviously do not concern themselves with such matters.

Meanwhile, the city government of Karachi, perhaps taking its cue from Islamabad, has decided to give what is left of Clifton beach, i.e. the seafront from the old Casino to Oyster Rocks, to private investors for high-rise residential and commercial buildings. The investors have been asked to generate their own power and acquire their own water for their projects.

The controversy doesn’t stop there — literally. Just as it has given away beach front property it probably doesn’t even legally have jurisdiction over, the DHA is equally nonchalant about disposing of properties that do fall under its control even if they are earmarked for citizens’ needs.

Three years ago, the DHA allotted a massive piece of land in Defence Authority Phase VIII, reserved for a cemetery, to a foreign company to build luxury apartments. Creek Vista is now almost complete, with each apartment costing about 12 million rupees. What was left of the property for the graveyard was given to some city businessmen to develop a mall and fast food joints on the pattern of those in western cities. So now, the sprawling Phase VIII neighbourhood, which is rapidly being built up and inhabited, will have no place to bury its dead.

In 2004, the DHA leased about 58,000 square yards of land to a colourful Karachi businessman for a paltry annual rent of 35 million rupees. Originally meant for a park, the land now controlled by the business tycoon is to house a commercial entertainment outlet, containing shops, restaurants, and theatres. The land, worth over 50 million US dollars at that time, was given virtually free of cost on a 100-rupee bond-paper, on the understanding that the beneficiary would pay the conservative annual rent and share a small percentage of its revenue with the DHA. Even at that time, the estimated future earnings were a pittance compared to the cost of the land.

Shehri, an NGO with environmental concerns, went to court and earned a stay on the property. The case is still in court. If commercialised, the land would now be worth more than 100 million dollars. On DHA maps, this piece of land, which is located next to Masjid-e-Usman, is still shown as a park.

The saga continues. Since several poor neighbourhoods, housing hundreds of thousands of people, mainly from the labour class, surround the affluent neighbourhoods of Clifton, Defence, Lalazar and its business districts, there are reports that proposals are being floated to have these areas vacated by paying the residents compensation. These residents now sit on some of the city’s most potentially expensive land. However, since their properties mostly comprise ramshackle and poorly built houses measuring from 45 square yards to a maximum of 200 square yards, their neighbourhoods are not properly planned and lack civic amenities, the value of their properties is low. As such, there are moves to entice these people to shift to the outskirts of the city by paying them 10 times the present market value of their properties. With these areas cleared out, the buyers, allegedly, expect to reap a windfall in the process, since once divested of tenants, broken-down structures and garbage, the price of the land will obviously climb many notches.

The residents meanwhile, are likely to readily agree to the chance of earning a lot more than their property is currently worth.

It is a supreme irony that the federal and provincial governments have readily bartered away prime property for luxury projects, even while Karachi is on the verge of a complete breakdown with not even its basic facilities functional.

Small wonder that the city sorely lacks a workable master plan. The last plan that made any real sense was designed 32 years ago, i.e. in 1974. Many independent city planning experts believe the 2000 master plan is a complete failure. In fact, it takes no expert to gauge this, given the acute scarcity of water and power in Karachi. The city’s industrial base continues to shrink as successive governments fail to provide many of the industrial sector’s needs. Commuters waste thousands of gallons of fuel and hours of precious time, stuck in clogged traffic daily, courtesy either broken, potholed roads, often too narrow to accommodate increasing numbers of vehicles, or roads dug up, ostensibly to lay one line or another, but abandoned midway for unknown reasons. Crime is rampant. Construction is haphazard. Parks are scarce, and medical facilities for the public are few and far between. Those that exist, meanwhile, are in an abysmal state.

Against this backdrop, the mega-developments planned for the city seem nothing short of a travesty. Roland D’Souza of Shehri plans to contest all these projects in court, especially those which are on the beach. “Since there is no money, people are not interested in Karachi,” he says. According to him, the country’s policy makers seem to believe that by selling the coastline and launching high-profile projects, such as Bundal and Buddo islands — which alone will bring in 43 billion dollars to be received over a period of 13 years — more than Pakistan’s entire foreign debt — they will be able to reshape Karachi. That is why, he contends, there is no resistance to these projects.

There seems to be some merit in this argument, considering that even those directly involved — the MQM for example, which claims to represent 98 per cent of the poor people of Pakistan — have been criminally silent about the bartering away of the precious few recreational spaces the public could hitherto access. Its coalition partner in the Sindh government, for its part, also seems to have no apparent problem with the sale of its beaches or islands.

Ironically, the only problem the Sindh government does have, is the fact that Port Qasim claims Bundal and Buddo islands as its properties. The provincial government maintains the islands belong to it.

The MOU with Emaar for the sale of the islands was signed between PQA officials, Irfanullah Marwat representing the Sindh government and Emaar representatives. The Sindh government hopes to convince Emaar to deal with it in respect of financial transactions, so that its coffers will be enriched by the deal. While this issue remains unresolved, Sindh government officials demonstrate no qualms about the actual sale of the properties to a foreign investor. “As far as we are concerned Emaar is a lesser evil than the army — and we could benefit substantially by dealing with them,” said a government official.

However, speaking off-the-record, a senior political figure in the Sindh government blamed the army for these recent developments. “They are taking all these decisions at gunpoint. We can’t do anything,” he disclosed.

“These things are decided by the President and the Prime Minister. We don’t have any say,” maintained another top Sindh government official.

The city’s top businessmen and industrialists, meanwhile, are afraid to annoy the MQM or the army by opposing these developments. So except for Shehri and a few concerned citizens, no one from Islamabad to Karachi has raised their voice against the privatisation and commercialisation of Karachi’s coastline.

The new developments will certainly change the face of Karachi. But if the trend continues, in just a couple of years the majority of the city’s population will not only be even more on the outside looking in than it is now, it will probably only be able to see the ocean — hitherto it’s one respite — on celluloid.