The Sindh Master Plan Authority has withdrawn a seven-year ban on converting residential plots for commercial use across the province, reopening the door to land-use changes in Karachi, Hyderabad and other cities after years of frozen applications.
The move follows recent rulings by the Supreme Court and the Federal Constitutional Court, and comes alongside a new formula for distributing the infrastructure fees collected whenever land use is changed.
What the Notification Says
“The notification issued by the Sindh Building Control Authority in pursuance of the Order dated 22.01.2019, regarding the immediate ban on conversion (change of land use), is hereby withdrawn with immediate effect,” the Authority said in its notification.
The withdrawal effectively removes the 2019 Sindh Building Control Authority order that had frozen land-use changes following Supreme Court rulings issued on December 21, 2018 and January 22, 2019. Those earlier orders had brought residential-to-commercial conversions across the province to a near-complete halt, leaving numerous projects from builders and developers pending for years.
The change follows a Federal Constitutional Court ruling from May 12, 2026. A two-member bench headed by Justice Aamer Farooq disposed of the underlying case at that time, setting aside the earlier prohibition on converting residential plots to commercial and recreational use in Karachi.
Not an Automatic Green Light
Officials have been careful to stress that lifting the ban does not mean every residential plot can now be converted freely. Any change in land use will still require compliance with applicable laws, zoning regulations and the city’s master plan, along with a formal no-objection certificate and approval from the relevant competent authority.
Shakeel Siddiqui, senior director at the Sindh Master Plan Authority, confirmed to Dawn that the new land-use regime would be applicable immediately, describing the issue as one that has remained contentious for years, particularly as commercial activity has expanded into residential neighborhoods.
The court has also drawn a firm line around so-called amenity plots. Land designated for parks, hospitals, schools, mosques, playgrounds and graveyards cannot be converted for commercial or residential purposes under any circumstances, regardless of the broader policy change.
A New Fee-Sharing Formula
Alongside the lifted ban, the Sindh government has introduced a new formula for distributing the infrastructure fees collected when land use is changed. The Local Government and Housing, Town Planning Department prepared the new arrangement, which divides districts and divisions across Sindh into three categories for fee collection and distribution among various municipal bodies.
Under the new formula, Karachi Division and Hyderabad district will see a significant share of the collected infrastructure fees, according to details of the notification reported by local outlets, with the remaining share distributed to other municipal authorities involved in the conversion process.
Why It Matters
The ban’s removal is expected to reopen a wave of pending applications from Karachi’s real estate sector, where the restriction has been described as one of the city’s longest-running regulatory roadblocks. The Karachi Metropolitan Corporation itself has already sought conversion of several of its own properties, including sites in Frere Quarters, Gulshan-i-Iqbal and the old Sabzi Mandi area, suggesting the policy shift could trigger a broader wave of new applications across the city in the months ahead. Analysts have noted, however, that the shift from an outright freeze to a case-by-case approval process still leaves considerable discretion in the hands of Sindh’s regulatory authorities.
