Prime Minister Shehbaz Sharif has taken notice of concerns regarding the government’s housing finance scheme and its compatibility with Pakistan’s constitutional commitment to transition toward an interest-free financial system. The move comes after a media report highlighted potential inconsistencies between the structure of the housing program and the constitutional deadline set for eliminating interest-based financial practices.
According to official sources, the Prime Minister has directed relevant authorities to conduct an immediate and comprehensive review of the matter and submit a fact-based report. The directive underscores the government’s intent to ensure that its major financial initiatives remain aligned with constitutional requirements and broader policy commitments.
The issue revolves around the “Apna Ghar Program,” a large-scale housing finance initiative valued at approximately Rs 3.2 trillion. The program is designed to facilitate home financing for thousands of citizens, particularly those belonging to low- and middle-income groups. However, concerns were raised that the structure and duration of the scheme could result in the continuation of interest-based loans beyond January 1, 2028—the deadline set under the 26th Constitutional Amendment for transitioning to a Riba-free (interest-free) financial system.
Following the publication of the report, the Prime Minister reportedly sought a detailed briefing from officials to better understand the legal and financial implications. The briefing is expected to examine whether the current framework of the housing scheme conflicts with constitutional provisions and to explore possible adjustments that could bring it into compliance.
This development reflects a broader policy challenge faced by Pakistan as it attempts to shift its financial system away from interest-based mechanisms. While the transition toward Islamic or interest-free banking has been a long-standing objective, implementing it across all sectors—especially large-scale financing programs—remains complex. Housing finance, in particular, involves long-term loans, often spanning 15 to 20 years, which makes alignment with a fixed constitutional deadline more complicated.
Experts suggest that resolving this issue may require restructuring the financing model, potentially incorporating Islamic banking instruments such as diminishing musharakah or ijara-based solutions. These alternatives could allow the government to continue supporting housing initiatives while remaining compliant with constitutional and Shariah-based financial principles.
The Prime Minister’s decision to seek a report indicates a recognition of both the legal sensitivities and the economic importance of the housing scheme. On one hand, the program aims to stimulate the construction sector, create employment opportunities, and address the country’s housing shortage. On the other, it must adhere to constitutional mandates and avoid potential legal challenges that could arise if inconsistencies persist.
The forthcoming report is expected to play a key role in determining the future course of the housing finance scheme. It may also set a precedent for how other government-backed financial programs are designed in the context of Pakistan’s transition to an interest-free economy.
As the deadline approaches, policymakers will likely face increasing pressure to ensure that all financial frameworks are aligned with constitutional requirements. The outcome of this review could therefore have far-reaching implications, not only for the housing sector but for the broader financial system as well.
