Pakistan Construction Market Size, Trend Analysis by Sector (Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential) and Forecast, 2023-2027

Pakistan Construction Market Size, Trend Analysis by Sector (Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential) and Forecast, 2023-2027

Summary

The construction industry in Pakistan is expected to contract by 5.2% this year, following the decline of 2.8% recorded in 2022. The larger contraction in output this year will be due to the continued worsening of economic, political and financial conditions in the country. Pakistan’s substantial current account deficit, high public debt, depleted foreign exchange reserves, high inflation and surging energy and construction material prices are all expected to weigh on construction activity this year. In order to secure a $1.1 billion tranche of IMF funding before the expiry of the IMF’s Extended Fund Facility on June 30, 2023, the Pakistani government has significantly tightened its FY2023 budget. The government has been forced to cut spending, increase its tax base and lift restrictions on imports, with the depletion of Pakistan’s foreign exchange reserves increasing its reliance on IMF funds in order to prevent a default on its external debt. Pakistan’s economic woes have been further compounded by soaring rates of inflation, with annual consumer price inflation rising to 37.97% in May 2023. Pakistan’s central bank continues to hike interest rates in response, raising its benchmark interest rate by 100 basis points to 22% in June 2023, and this will weigh on both public and private construction investment this year.

The industry’s growth over the remaining part of the forecast period will be supported by investment in transport, electricity, housing, telecommunication, and industrial infrastructure projects. According to the Indicative Generation Capacity Exemption Plan (IGCEP) for 2022-31, finalized by the state-owned National Transmission & Despatch Company (NTDC), power demand in the country is estimated to rise from 26.9GW in FY2021/2022 to 44.7GW in FY2030/2021. The rise in power demand is expected to attract public and private sector investments towards the electricity sector in the coming years. The government estimates that the country will require an investment of approximately PKR10.5 trillion ($55 billion) to increase the total installed power capacity from 41GW currently to 65GW by 2031. In early November 2022, the World Bank approved financing of over PKR573.5 billion ($3 billion) to support infrastructure development in the energy sector.

The report provides detailed market analysis, information and insights into the Pakistani construction industry, including -

• The Pakistani construction industry's growth prospects by market, project type and construction activity
• Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in the Pakistani construction industry.
• Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.

Scope

This report provides a comprehensive analysis of the construction industry in Pakistan. It provides -

• Historical (2018–2022) and forecast (2023–2027) valuations of the construction industry in Pakistan, featuring details of key growth drivers.
• Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
• Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
• Listings of major projects, in addition to details of leading contractors and consultants

Reasons to Buy

• Identify and evaluate market opportunities using GlobalData's standardized valuation and forecasting methodologies.
• Assess market growth potential at a micro-level with over 600 time-series data forecasts.
• Understand the latest industry and market trends.
• Formulate and validate strategy using GlobalData's critical and actionable insight.
• Assess business risks, including cost, regulatory and competitive pressures.
• Evaluate competitive risk and success factors.