Builders and Developers Face Rising Extortion Threats from UAE and Iran, ABAD Warns of Karachi Shutdown

Introduction

Karachi’s construction and real estate sector is facing one of its most serious crises in years as builders and developers report a sharp rise in extortion and kidnapping threats. According to the Association of Builders and Developers (ABAD), criminals operating from abroad — particularly from the UAE and Iran — are targeting Karachi-based businesses with multimillion-rupee extortion demands.

In response to the deteriorating law-and-order situation, ABAD has issued a one-month ultimatum to the government, warning that all construction activities in Karachi could be shut down from January 15, 2026, if decisive action is not taken. Industry leaders say the situation has reached a breaking point, threatening not only private businesses but also Pakistan’s wider economy.

ABAD Issues One-Month Ultimatum to Government

At a high-profile press conference in Karachi, ABAD leadership announced that builders and developers could suspend operations if extortion and kidnapping-for-ransom cases continue unchecked.

The press conference was attended by:

• ABAD Chairman Hasan Bakhshi
• Patron-in-Chief Mohsin Sheikhani
• Senior Vice Chairman Afzal Hameed
• Karachi Chamber of Commerce representative Hafeez Aziz
• Other prominent stakeholders from the business community

ABAD leaders stressed that the government has only one month to restore law and order, or face a complete halt of construction activity in Pakistan’s largest city.

Extortion Calls Reportedly Coming from UAE and Iran

One of the most alarming revelations made by ABAD Chairman Hasan Bakhshi was that at least 10 ABAD members received extortion calls from Dubai and Iran, with each call demanding Rs. 50 million.

According to ABAD:

• Criminals are using foreign phone numbers to avoid detection
• Bank account details are openly shared for traceable transfers
• Threats escalate quickly if payments are not made

In several cases, when builders refused to pay extortion money, employees were shot and injured, sending shockwaves through the business community.

Named Criminal Networks Allegedly Targeting Builders

Hasan Bakhshi publicly named individuals allegedly involved in systematic extortion:

• Ahmed Ali Magsi
• Jameel Chhanga
• Samad Katiyhawari
• Aziz Lakho

He claimed that 15 to 20 ABAD members are already paying monthly extortion to these groups, highlighting how deeply rooted the problem has become.

Despite the seriousness of these allegations, ABAD leaders questioned why no effective action has been taken so far.

Police and Law Enforcement Accused of Inaction

Addressing the media, Mohsin Sheikhani, ABAD’s Patron-in-Chief, said the decision to threaten a shutdown was not taken lightly. He stated that police appear helpless against organized extortion networks and that criminal activity continues openly.

He emphasized that:

• Law enforcement agencies have failed to dismantle extortion gangs
• Red warrants against identified criminals have not been issued
• Victims feel abandoned despite submitting formal complaints

Sheikhani warned that unless international-level action is taken, the situation will continue to deteriorate.

Builders Question Role of Interior Ministry

ABAD leadership also raised serious concerns about the Interior Ministry’s performance, questioning why criminals openly sharing bank account details have not been arrested.

According to Bakhshi:

• Extortion money is transferred through traceable banking channels
• Victims have submitted evidence to authorities
• No meaningful arrests or convictions have followed

He said Karachi’s traders and builders have effectively been left defenceless, despite paying taxes and contributing heavily to the national economy.

Karachi’s Economic Contribution Declining

One of the most concerning outcomes of rising insecurity is the decline in Karachi’s contribution to national tax revenue.

ABAD revealed that:

• Karachi’s share of national tax revenue has fallen from 65% to 54%
• Businesses are relocating to safer cities
• Investment confidence is rapidly eroding

Bakhshi warned that continued instability could permanently damage Karachi’s status as Pakistan’s economic engine.

Applications Submitted to Sindh Leadership

ABAD confirmed that formal applications regarding extortion and law-and-order issues have already been submitted to:

• PPP Chairman Bilawal Bhutto Zardari
• Sindh Chief Minister

ABAD leadership said that after repeated warnings and written complaints, no authority can now claim ignorance of the situation.

Threat of Protest Sit-Ins if Situation Does Not Improve

If the government fails to act within one month, ABAD has warned that it will move toward protest sit-ins and shutdowns.

According to ABAD:

• Construction projects across Karachi will be halted
• Thousands of workers could lose daily wages
• Real estate investment may freeze completely

Industry leaders stressed that protests are a last resort, but survival of businesses has become impossible under constant threat.

Real Estate Collapse Could Hurt National Economy

Senior Vice Chairman Afzal Hameed described the crisis as a conspiracy to sabotage Pakistan’s economy.

He warned that:

• Collapse of Karachi’s real estate sector would impact allied industries
• National remittances could decline due to reduced confidence
• Foreign investors may completely pull out

He stressed that real estate is directly linked to employment, banking, steel, cement, and consumer markets.

Traders Also Facing Extortion Threats

The crisis is not limited to builders alone. Karachi Chamber of Commerce representative Hafeez Aziz said traders in major commercial areas like Jodia Bazaar are also being targeted.

According to Aziz:

• Some traders are paying extortion in lakhs
• Others are paying Rs. 50,000 per month
• Lives and businesses are constantly under threat

He emphasized that security is a basic constitutional right, not a favor from the state.

Growing Fear Among Business Community

The continued rise in extortion cases has created an atmosphere of fear across Karachi’s business sectors.

Key concerns include:

• Safety of employees and families
• Loss of investor confidence
• Rising operational costs due to private security

Business leaders warn that without immediate reforms, Karachi risks long-term economic damage.

What ABAD Is Demanding from the Government

ABAD has outlined clear demands, including:

• Immediate crackdown on extortion networks
• Issuance of red warrants against identified criminals
• International coordination with UAE and Iran
• Protection for complainants and witnesses
• Accountability within law-enforcement agencies

They argue that without structural reforms, temporary actions will not solve the crisis.

Conclusion

The warning issued by the Association of Builders and Developers reflects a deep crisis facing Karachi’s economy. Extortion calls from abroad, open threats, and lack of enforcement have pushed builders, traders, and investors to the edge.

If the government fails to restore law and order before January 15, 2026, Karachi may witness one of the largest economic shutdowns in its history — a move that could ripple across Pakistan’s already fragile economy.

Frequently Asked Questions (FAQs)