Prime Minister Shehbaz Sharif’s flagship “Apna Ghar Programme” may face a constitutional hurdle due to its reliance on interest-based financing, raising concerns over compliance with Pakistan’s legal framework.
The Rs3.2 trillion housing scheme, launched to provide affordable loans for low- and middle-income citizens, is structured around interest-based lending that could extend beyond the constitutional deadline for eliminating riba (interest) by January 1, 2028.
Officials told local media that the programme’s five-year financing plan and 20-year repayment structure mean interest-bearing loans would continue well past the deadline, potentially conflicting with constitutional requirements.
Under the scheme, borrowers can access loans of up to Rs10 million, with a fixed markup of 5% for the first 10 years followed by market-based rates, further entrenching interest-based banking practices.
The initiative aims to finance up to 500,000 housing units nationwide and stimulate economic activity in the construction sector. However, experts warn that unless the scheme is restructured along Shariah-compliant lines, it could face legal challenges as the deadline approaches.
Government officials have yet to publicly respond to concerns regarding the scheme’s constitutional implications.