The ranks of the urban poor are rising in Third World countries. Most families arriving in cities are pushed into squatter settlements, where they suffer from shoddy housing, thugs, discrimination, poor infrastructure, sparse health care, insecurity of property, and unspeakably poor sanitation. More than one half of Asia’s urban poor—over one billion people—live in squalid shantytowns. While often seen as a spreading blight and an incurable nuisance, these vulnerable people can be transformed into a social boon. The UN Centre for Housing Development (Habitat) estimates that one quarter to one third of urban residents live in absolute poverty and contends that an active housing policy should be seen as a strategic economic and social investment that will generate large multiplier effects in backward and forward linkages and in productivity.

If development experts in Pakistan are viewing the urban housing crisis with renewed optimism, Tasneem Ahmad Siddiqui, the savvy chief of the Sindh Katchi Abadi Authority (SKAA) in Pakistan, should be credited for assembling a realistic and humane policy. The Sindh, which includes the cities of Hyderabad and Karachi, is the southernmost of Pakistan’s provinces. A katchi abadi is a “temporary settlement,” a euphemism for the local version of the slums mushrooming in Third World cities everywhere. Nearly one half of Karachi’s five million people live in illegal settlements, and it is the Herculean task of Siddiqui’s agency to “regularize” as many katchi abadis as possible by providing legal titles, upgraded building materials, and basic urban services.

The Plight of the Poor

Development, even when it goes according to plan, uproots rural populations who must fend for themselves against land speculators and crooked officials in cities. The Pakistani government, perennially riddled by corruption, is strapped for cash for the poor, and the private sector simply cannot be bothered. The few public-housing schemes of the late 1970s were milked dry by speculators or pounced upon by middle-class families buying plots as investments. At that time, the availability of land for indigent people was advertised in daily newspapers on a first-come first-serve basis, which was not as egalitarian as a one might imagine. “The local people were illiterate and the down payments were too big,” explains SKAA organizer Jawaid Sultan. Speculators and crafty bureaucrats had an advantage, and local councils, easily influenced by powerful developers, frequently yielded to politically influential clients who did not genuinely qualify for plots.

The poor were not entirely prevented from gaining land, but they still faced challenges from “land grabbers” who contrived illegal leases for squatters, chartered water trucks, tapped electricity lines, and charged premium prices for these and other vital privileges. The poor, especially in the Third World, always pay more: their rent-to-income ratios, according to UN data, are considerably higher than those of people in industrial countries. According to an Oxford University Press report, poverty in Pakistan rose from 20 percent in the 1980s to 33 percent this year, and the refugees created by the Afghan intervention have helped to increase that percentage. In addition to mismanagement and corruption, critics point out that the International Monetary Fund’s (IMF) structural adjustment programs since 1988 have hurt the poor by lowering aggregate demand for labor, cutting government services and subsidies, and limiting job opportunities.

Pakistan also employs a tax system with barely any effective income tax, extensive subsidies for the wealthy, and heavy dependence on regressive sales taxes. Consequently, there is a massive untaxed black market. Ironically, the IMF structural adjustment programs heavily cut tariff revenues and hiked sales taxes but still yielded a revenue shortfall that required even more borrowing. Land reform is unlikely, and as avid migrants crowd into Karachi seeking work, the population grows at a rate of 5 percent annually—almost twice the Third World urban average. Less than one third of the 80,000 housing units needed annually are provided by the legal economy. Yet, at the same time in Karachi, 200,000 plots designated for the poor lie vacant. There is no shortage of land, merely a lack of political will to use it for the welfare of the poor rather than the well-connected.

Community Integration

Although katchi abadis are often derided as breeding grounds of crime and indolence, they should be seen as sources of indispensable labor, energy, ideas, and skills. The social task is to help migrants become solid citizens and productive members of the work force. Siddiqui argues, “What we need is a paradigm shift in the planning and development process from top-down to bottom-up.” Elites in Pakistan, he says, “suffer from a quick-fix syndrome based on wishful analyses. If this country survived all its crises, it is not because of the educated classes but in spite of them. The real architects of Pakistan are the ordinary people.... They work hard and they face all hardships with equanimity. Their natural talent and ability to absorb skills should be tapped to the fullest.”

Mixing vibrant community self-reliance with a little help from the government, Siddiqui and SKAA employees devised a cost-effective, innovative, and sustainable model of housing development. Success can only be achieved, Siddiqui says,“when you involve the community in the entire process from inception to completion. They will eventually own the project.” In effect, Siddiqui has generated a government-sponsored self-help movement, or, as he puts it, a “government-NGO-community partnership.” The SKAA chief deliberately delegates decision-making power to the lowest tiers and then to the local community, a division of labor deemed essential for development to succeed. Instead of elites treating the poor migrants like beggars, they are made partners in community development.

Designed to deliver all the ingredients of decent housing in affordable doses, the “incremental housing” model sprang up in the 1960s with pilot projects in rural cooperatives in what was then East Pakistan and from 1980 onward in the huge Karachi slum of Orangi. The latter project embraced one million low-income inhabitants who, on a spirited self-help basis, improved their schools, housing, and health-care access, and even built a sewage system at one fifth the cost projected by civil agencies.

In 1987 Siddiqui carried out an Orangi project-style housing experiment in Hyderabad, which was so successful that it unnerved local elites who vigorously pressed the government to have Siddiqui transferred. Civil servants are customarily moved around the bureaucratic game board, but the unconventional Siddiqui has exceeded all known records with 26 postings in a 32-year career. Under local and international pressure, the government reversed itself and in 1991 placed him in charge of the SKAA, which had responsibility for programs for temporary housing developments existing before March 1985. In short order, he transformed an agency that had not provided a single lease in its first five years and had previously been confused by unrealistic rules and arcane procedures into an exemplary operation that greatly benefited the urban poor. Siddiqui established a “one window” operation to ease access to leases for needy clients and to increase efficient oversight and transparency. The objective of Siddiqui’s system is to learn from the community, take the best of people’s ingenuity, and legalize their living conditions. “We saw what people needed, what the problems were, and why government housing projects were not able to deliver. We tried to learn from the informal sector. As a matter of fact, we formalize[d] the informal sector,” Siddiqui says. The SKAA evaluates katchi abadis, supervises their “rehabilitation,” and coordinates the procurement of building materials, water, electricity, sewage and waste disposal, and transport needs.