Any land owned by a country should be utilized efficiently for productive purposes otherwise it becomes a liability and restricts the development of the cities.
A huge area owned by the state is found idle in various cities which is a hurdle in the development of the country. The poor handling and management of this capital resource is an example of dead capital.
Dead capital in context to the land refers to the piece of land that has a prime location and a high market value but is still underutilized or is not used for a more productive purpose. The lands which have great potential to construct high-rise buildings but instead single-story houses are constructed are considered dead capital.
In Pakistan, a large portion of state-owned land has been dedicated to housing or residencies for government employees, which can be utilized to its full potential if is expanded vertically instead.
The houses constructed on these lands can be managed efficiently and effectively if 6 high-rise buildings are constructed and statistically it will free up almost 77 acres of land. The estimated net revenue of PKR 52 Billion can be fetched if the government takes any steps toward such initiatives.
During Imran Khan’s government, the value of total dead capital only in urban areas was about PKR 300 Billion. Despite the acknowledgment, no decisions were made to utilize such lands for the stability of the country.
Steps to Effectively Manage Underutilized State-Owned Land
If these abandoned or underutilized public assets are managed properly there is much more that can be achieved. In addition to vertical expansion, this strategy can also aid in accommodating the increasing population of the country.
In contrast, the horizontal expansion will worsen the country’s condition as it will cause land scarcity along with the death of a large portion of the green areas.
The second option could be selling the abandoned land but for that, the government needs to keep a record of the land and has to indicate which portion can be utilized and which can be sold for a greater good. This strategy is used by many developing and developed countries around the globe.
In 2010, the United Kingdom has established a government property unit to manage the state-owned lands efficiently. UK’s National Audit Office reported in 2017 that it raised GBP 2.5 billion by selling state-owned property. This step has also reduced the government’s annual spending on these underutilized lands by GB775 million.
On the other hand, India has also initiated a plan to sell state-owned assets which are worth $18 billion in the next four years.
Such steps should be taken by the Government of Pakistan to manage the state-owned land to utilize it to its full potential.
