KARACHI, Nov 8: The Sindh government on Tuesday promulgated the Colonization of Government Lands (Sindh amendment) Ordinance 2005, with an obvious objective to counter the clout of real estate speculators in the business and give impetus to construction activities.

For this purpose, the Punjab Act 1912 has been amended with the addition of a section 10 which stipulates disposal of the government land at a price less than the market rate to individuals, an autonomous body, authority, a company and a group of persons.

“You will see the rate of industrial land coming down in SITE Manghopir, Korangi and other areas very soon,” a well-placed source in the Sindh government told Dawn on Tuesday. He agrees that investment in Karachi and some parts of Sindh has become hostage to a few real estate speculators who demand Rs60 to Rs70 million for an acre of land in SITE Manghopir and other areas.

Henry Birr, regional director of German store chain Metro, is coming here next Monday to have final talks with officials of the Sindh government for getting a suitable piece of land in Karachi for setting up a retail outlet and packaging and processing facility.

Metro is looking for a 10-acre plot to invest 150 million euros. The executives of Metro have been searching in vain for a plot for the last nine months.

The promulgation of this ordinance comes in the wake of reports that the government is considering extending about 10,000 acres of land, bulk of it in Karachi and around it, for industrial investment in the next few months.

Another source informs Dawn that there are three summaries on chief minister’s desk that propose 5,000 acres of land for industrial investment somewhere in close vicinity of the northern bypass of Karachi, 1,000 acres in Korangi and 1,500 acres near Kotri. The extension of industrial land is also being planned in other parts of the province.

Industrial land will be sold at 25 per cent of the market rate, with a condition that the non-utilization of allotted land for two years will result in confiscation of the plot and constructed structure with no provision of any refund. A one-year grace period may be granted on payment of non-utilization fees.

The government has been empowered to determine the market rate for different land use from time to time. This will be notified in the official gazette. But the ordinance is silent on the basis and mechanism for working out market prices of the land, which gives wide discretionary powers to the sanctioning authorities.

The market rate has been made the benchmark for disposal of the government land to work out concession rates for different categories of prospective owners of the land. For example, a 120-square-yard of residential plot would be sold at 25 per cent of the market price. A plot measuring over 120 square yards would be disposed of at 50 per cent of the market rate.

The ordinance is specific on the grant of amenity land and declares that it will not be used for the purpose other than declared for the amenity. But the government has again been given wide powers to change the use of land from the purpose for which it has been granted for agricultural, residential and residential-cum-commercial purposes after the completion of three years from the grant of payment of different prices.

“It is merely a cosmetic legislation,” remarked a well-known business leader, who is actively involved in discussions and debate on revival of industrialization in Sindh. He said the need of the hour was an improvement in industrial estate management, simplification and lowering rate of land registration, abolition of use of power of attorney in land disposal and allied issues.

Now that graduate assemblies have turned into fish markets, the government is left with only option to legislate and that is through promulgation of ordinances. It is doubtful if the ordinance promulgated on Tuesday was discussed even in the Sindh cabinet. Business leaders were never contacted nor did anyone of them have the slightest idea of government thinking on this issue.