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Dealing with Licenses
With respect to licenses, investment and productivity in the construction sector are limited by a complex framework of laws and institutions at various levels of government. In addition, 40% of land in Pakistan is Government controlled, and zoning, land use, and building permits are politicized and act as a disincentive for rational development. Rent-seeking is ubiquitous in obtaining permits, dealing with inspections and obtaining utility connections. As a result, businesses in Pakistan reported that the land acquisition and site development regulatory interface is the worst administrative barrier they face.
The laws and procedures relating to real property are particularly cumbersome. The system of land laws and records has changed little since its creation in the early 17th century. Licenses, permits and inspections of land and improvements are found in at least 10 separate laws and bylaws in Karachi alone –and Karachi is probably the most advanced municipality in terms of land development. These laws do not reflect the needs of citizens and businesses and foster opportunities for corruption, inefficiencies in
construction projects, and a lack of urban planning and building safety.
(Note: This information was taken from the Bankruptcy chapter of the 2008 Pakistan BizCLIR report. For more information, please see the report.)
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