Karachi Expands Financial Horizons with Project-Backed Municipal Bonds

Mayor Murtaza Wahab Speaks at Pakistan Stock Exchange Gong Ceremony

By: Aziz Khatri

Karachi: In a landmark announcement, Karachi’s Mayor Barrister Murtaza Wahab expressed his plans to introduce project-backed municipal bonds aimed at bolstering financial stability and promoting inclusive development for the city’s residents. Speaking at the Pakistan Stock Exchange (PSX) Gong Ceremony, he emphasized the necessity of public involvement in the city’s growth and the strengthening of its financial foundation.

Wahab revealed a collaboration between the Karachi Metropolitan Corporation (KMC) and the PSX, outlining plans to construct a parking plaza at the Gateway of PSX on I.I. Chundrigar Road. This initiative will transform the road into a no-parking, walkable zone, significantly enhancing the area's accessibility. Funding for a parking structure at the Railway Ground has already been allocated, with efforts to focus on long-term and sustainable projects for KMC, the Water Corporation, and Solid Waste Management.

At the Gong Ceremony held on Monday morning, the mayor highlighted that the successful completion of the I.I. Chundrigar Road improvement project would send a powerful message to global investors about Karachi, Sindh, and Pakistan’s readiness for investment.

In an unprecedented move, Barrister Murtaza Wahab became the first Mayor to strike the PSX Gong, marking a historic moment attended by numerous PSX officials and members.

“Our city possesses significant landholding assets, and people can engage with us. If I want to bring a new water line from Haleji, which has the potential to supply around 65 million gallons of water, I shouldn’t have to rely on federal or provincial governments. I should be able to prepare the project, conduct feasibility studies, work with experts, and use municipal bonds, IPOs, and SPVs to raise funds backed by assets and projects,” Wahab stated. He expressed a desire for federal cooperation rather than seeking approval, underscoring the essential role of port cities and lamenting Karachi’s historical neglect.

Despite improvements in KMC's financial condition and ongoing city projects, Wahab acknowledged that insights from stock market experts could significantly bolster municipal efforts. He encouraged students to integrate financial markets into their future investment education.

Reflecting on his longstanding connection to the PSX, he recalled visiting the building since 1999, influenced by his mother’s leadership of the Standing Committee. “I always wondered how ordinary citizens access this important place,” he said, advocating for KMC to construct a modern parking plaza to benefit visitors to PSX and neighboring areas like Karachi Port and Kharadar.

Moving forward, Wahab detailed plans for a vertical structure at Railway Ground to address parking issues around Jang Press and Shaheen Complex. While awaiting federal approval for the parking structure construction, he affirmed that KMC has already allocated budget funds to begin work.

When taking office, Wahab noted that KMC was collecting merely Rs. 200 million annually through Municipal Utility Taxes, with substantial amounts going to private collection companies. This resulted in only around Rs. 150 million available for city operations—an insufficient amount for proper municipal functioning.

To combat these financial challenges, he introduced bold reforms: reducing municipal tax rates from a maximum of Rs. 5,000 to Rs. 300, and from a minimum of Rs. 500 to Rs. 20; shifting tax collection from a private entity to K-Electric for increased transparency and efficiency; and transitioning to a monthly revenue collection system instead of yearly. Consequently, revenue from real estate has tripled, jumping from Rs. 80 million to Rs. 270 million, with aspirations to reach Rs. 300 million.

Additionally, the mayor explained that existing dividers on I.I. Chundrigar Road would be replaced with durable structures, along with the upgrading of footpaths and streetlights. He requested PSX to install a monument outside its building, reminiscent of the Islamabad Stock Exchange, and announced the installation of artwork on the PSX building to enhance the visual appeal of the area.

With these initiatives, Mayor Murtaza Wahab is poised to transform Karachi into a robust financial hub, fostering growth and development that includes all citizens.