Business
Auto loans rise for 10th month
KARACHI: Outstanding auto loans increased to Rs305 billion by the end of September, up from Rs294bn in August, marking the 10th consecutive month of growth, according to the State Bank of Pakistan (SBP).
Despite the rise, auto financing remains below the record high of Rs368bn seen in June 2022. However, rising demand for vehicles — reflected in surging imports of semi- and completely knocked-down (SKD/CKD) kits — is expected to sustain momentum in the coming months.
Pakistan Bureau of Statistics (PBS) data show that imports of SKD/CKD kits in the first quarter of FY26 jumped 114pc to $458 million, from $231.4m in the same period last year.
Samiullah Tariq, Head of Research at Pak-Kuwait Investment Company, attributed the increase in auto financing to improving purchasing power and the launch of new models. Mohammad Sohail, CEO of Topline Securities, said auto leasing is becoming more attractive, with rates now below 10pc in some cases.
The policy rate cut from 22pc in June to 11pc has also contributed to stronger auto demand, despite higher car prices following the implementation of the New Energy Vehicle policy from July 1, 2025.
However, structural constraints remain. The existing cap of Rs3m on auto loans continues to restrict higher-end financing. Some market analysts suggest raising the limit to Rs6m, though the SBP is reportedly cautious, fearing that increased demand may strain foreign exchange reserves through higher imports.
Other regulatory restrictions, such as a 30pc down payment requirement and shorter loan tenures — five years for vehicles up to 1,000cc and three years for smaller cars — also deter potential borrowers.
Published in Dawn, October 17th, 2025
Business
The dangers of chemical pollution
Business
Cooling Karachi with green buildings
Karachi’s urban context is characterised by dense and narrow streets, frequent and long power outages, limited ventilation, and a general inability to afford air-conditioning, which often results in energy theft. In such environments, making green building codes mandatory is a required shift from governing and development bodies. Temperatures are rising every year, as is inflation, making thermal comfort unaffordable for lower as well as middle-income groups.
Regulations can be tailored to development size, with support mechanisms for enforcement, legal implications, and economic benefits of each law. Right now, most green ratings, such as LEED [Leadership in Energy and Environmental Desigh] or EDGE [Excellence in Design for Greater Efficiencies], are only relevant for high-end projects, therefore irrelevant for low- and middle-income developments.
Karachi’s current bylaws require that rooms in a building or house have a minimum percentage of openings or windows; for example, in a living room the opening size should be 10 per cent of the area of the room; this changes to 7.5pc for other rooms and 15pc for the kitchen.
All this looks impressive on paper, but that does not guarantee human comfort. These regulations were written decades ago, focusing on hygiene, and are not practical for today’s extreme heat.
The city’s building codes must take into account the sweltering heat when most of its people can’t afford to keep cool
Building codes in neighbouring countries, like India, or international standards like ASHRAE [American Society of Heating, Refrigerating and Air Conditioning Engineers] are focusing on performance. Instead of specifying how big a window should be, we need to ask basic design questions like, ‘Does this room have adequate fresh air? Is it designed to allow cross ventilation?’
The building codes in India ensure cross-ventilation in at least two rooms of every house, while internationally the number of times air should be replaced each hour to keep people comfortable is also specified. Karachi’s bylaws should enforce wind direction consideration and encourage the use of high and low vents, cement lattices, roof turbines, etc to ensure habitability during power outages. Ventilation is considered a formality, but elsewhere it is considered a necessity for making buildings habitable and comfortable.
Furthermore, roof cooling treatments should be made mandatory, like reflective lime plaster, reflective paints, or clay tile surfacing. Integration of green roofs in projects above 500 sqm, depending on optimum load capacity, should be compulsory. The CoolRoof Programme in Ahmedabad started as a pilot and is now a municipal regulation, serving as a key example from our own context. In the same vein, the use of solid blocks without insulation should be banned for south-facing external walls. While builders argue against prices of such products, it has overall reduced the structural cost of the building due to reduced load, hence it is more a matter of convenience rather than cost.
Another way to improve comfort is to make all external plaster/paint meet minimum reflectance, hence reflecting the maximum amount of radiation from the sun instead of absorbing it.
Countries like Bangladesh, India, and Egypt have set U-values (how fast heat dissipates) and R-values (the wall’s resistance to heat) for any construction, which mandate the use of insulated materials. Karachi desperately needs such a green building code.
As for the surrounding area, shading devices such as chajjas, verandahs, or sun breakers should be mandatory on south- and west-facing facades. The devices should leave 50pc uncovered yard space that lets rainwater soak in and trees grow, with one shaded tree per 30ft of frontage compulsory.
Efficient water management can also play an important role in cooling our city. Rainwater harvesting pits, permeable paving and low-flow fixtures in homes can help cut wastage. For larger projects, a required portion of grey water (from sinks and showers) is to be recycled for landscaping or flushing. This will ensure that saving water becomes a standard like laying bricks.
For effective implementation, the builder community must foresee the financial value in adopting these rules. While this can bring prestige and recognition in upper-income residential projects, middle- and lower-middle-income group housing needs to be targeted. Bulk procurement, tax breaks and reduced approval fees can be offered as incentives.
Finally, instead of solely relying on government agencies, which are often mistrusted, incentives could be built into the system. For example, housing finance institutions and banks can offer lower interest rates and easier loan terms for greener projects. The creation of bulk-purchasing networks by material suppliers will ensure that eco-friendly products are available at lower prices so the builders naturally shift towards them. Housing cooperatives, neighbourhood associations and buyers’ groups can create a demand for cooler homes; builders will adapt for competition.
These are not luxury ideas but a necessity for survival in a city where most people cannot afford air-conditioning. Government agencies, private institutions and citizens must act with urgency to ensure comfortable living across all income groups.
The writer is an architech and urban planner, currently leading her own practice, “Beyond Facades”
Published in Dawn, The Business and Finance Weekly, October 27th, 2025
Business
Govt to defer gas import plans as demand eases, LNG glut extends
• UK-based firm projects 3pc fall in national gas demand during 2025-40
• Urges reforms as circular debt rises due to price distortions, market imbalances
ISLAMABAD: Despite population projections of 325 million over the next 15 years and rising overall energy needs, Pakistan may have to put off gas import options owing to declining demand until 2040 and the surplus of liquefied natural gas (LNG) going beyond 2031.
Sources told Dawn that an “all-of-government” approach is under consideration to slow-pedal both pipeline imports — from Turkmenistan and Iran — and readjust LNG supply schedules, while pushing through structural reforms to underpin sustainable growth.
The rethink follows a study by UK-based consultancy Wood Mackenzie, which projects a three per cent decline in national gas demand during 2025-40 under a business-as-usual scenario, even as total gas availability — including take-or-pay LNG — rises into the early 2030s.
The total gas supply, including that of LNG contracts, has been estimated to peak at five million cubic feet per day (mmcfd) by 2031 from around 3.8mmcfd today, up 31pc.
Demand, on the other hand, is projected to decline by 3.8pc by 2031 and 2.5pc in the subsequent nine years, with a cumulative average of 3pc between now and 2040. This takes into account more than a 12pc fall in the power sector’s gas needs and 2.8pc and 4pc growth in industrial and domestic needs, according to the study reviewed by Dawn.
“A clear pathway to address the structural market issues and towards greater market liberalisation is required as circular debt continues to escalate due to price distortions, inefficient resource allocation and market imbalances,” suggested the consulting firm, pointing out that addressing the root cause of the problem was to fix structural issues that have contributed to the issue of circular debt and to evolve the sector to Pakistan’s needs.
The reform areas would include constraints to investments for fresh exploration and production, weighted average costing of all gas sources, power sector gas offtake issues, forced curtailment of domestic fields, runaway gas losses, limited gas storage and increasing solarisation.
One of the key takeaways from the study is that Pakistan will not require as much LNG as originally anticipated, even in the near to mid-term, hence the need to develop an LNG import strategy to determine measures to deal with existing contractual arrangements, “assessing all options on the table”.
The low demand and higher import contracts are already taking a heavy toll on exploration and development activities in the country, with long-term adverse consequences — gas import costs in any shape are more than double the local production.
On the other hand, the report anticipated a new wave of LNG supply, indicating pricing cuts as the US and Qatar account for more than half of global LNG supply over the next decade, but Pakistan hardly benefits.
“The new wave of LNG supply will start putting pressure on prices from 2026, with the expectation of long-term prices being set by marginal US LNG cargoes,” it said. Simultaneously, LNG demand will be rising by 3pc over the 2025-40 period from over 400 million tonnes per annum to 675 mpta, mainly due to LNG demand growth in the Asia Pacific.
At present, fossil fuels account for about 88pc of total end-use consumption in Pakistan, of which gas and oil account for around 42pc and 29pc, respectively.
By 2040, while still dominant, consumption of fossil fuels is estimated to decline to about 84pc, with gas share coming down to 30pc and share of oil going up to 34pc, mainly owing to growing demand in the transportation sector.
Primary energy demand is expected to grow from about 88 million tonnes of oil equivalent now to over 99 million tonnes by 2030.
The power sector remains the key problem. Pakistan is going through a paradigm shift, both in terms of a reduction in demand (especially power and captive power plants) and the premise of greater availability of domestic supply.
“Full alignment and commitment of the plan for gas offtake from the power sector is crucial as it will shape how Pakistan’s overall gas demand will evolve,” the report said, but warned that challenges of the exploration and production sector will need to be addressed to realise forecasted supplies, as the LNG glut has forced closure of local gas fields.
It noted that while the country had made progress towards macroeconomic stabilisation, further reforms were required to sustain economic growth as the population was expected to reach 325 million by 2040, at a steady growth of 2pc and a young demographic, maintaining its position among the top five most populous countries.
Between 2025-40, economic activity is expected to grow with a long-term GDP compound annual growth rate of 3.7pc. Economic activity is expected to continue recovering, as the economy benefits from the availability of imported inputs, easing domestic supply chain disruptions and lower inflation,” it said.
The study forecast the industrial production achieving an annual growth rate of 4pc over the next 15 years. It also noted that while Pakistan’s growing population offered potential demographic dividend, the country faced significant challenges in harnessing this potential due to existing resource constraints, infrastructure deficits and employment issues. The population growth will nevertheless increase energy demand in residential sectors for heating and cooking and power generation to meet rising electricity needs and transportation.
Published in Dawn, October 27th, 2025
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