The past couple of decades have seen successive governments’ efforts to allure foreign investors and tourists in tandem with promoting the country’s softer image. Owing to first-hand exposure of foreigners in Pakistan and social media reels, our friendly and welcoming profile has become a brand and unique selling trait. But does Islamabad’s hospitality landscape reflect this as regards presenting the capital as a more than enthusiastic host, especially in terms of wider choice of hotels?
The need for high-end staying spaces in Islamabad has surprisingly been off the radar of our policy planners and city managers despite an increasing flurry of diplomatic and business activities apart from the capital’s crucial role as the gateway to the country’s spectacular northern areas. According to Statista, a global data and intelligence platform, around one million international tourists visited Pakistan in 2023- the largest number to enter an Asian country during that year. Recent studies forecast an annual growth rate of 6.91 percent for the hotel industry in Pakistan between 2025 and 2029.
Positive travel advisories by foreign governments coupled with a liberal visa regime in Pakistan, new flights operations and online travel booking are multiplying the number of travellers flocking to Pakistan. One major consideration for the visitors is the choice of hotels whose number is far below the rising demand in the capital. This has been revealed in a survey of Travel and Tourism Development of 119 countries conducted by the World Economic Forum in which Pakistan has been placed on the 101st rung. Among other determinants, tourism infrastructure of hotels are the principal ingredient is a salient matrix assessed by the Forum.
In the backdrop of the government’s ambitious plan to upgrade Islamabad into a smart capital with world-class infrastructure and services, the emergence of new luxury hotels should be a high priority. The city has only three five-star and a couple of four or three-star hotels. According to estimates 4000 rooms per night are available in Islamabad against the increasing need for over 8000 rooms. As regard latest developments the in this domain, Movenpick hotel began operations in Islamabad in January this year, 23 years after Serena hotel came up in 2002. Radisson hotel is still a grey structure near Islamabad airport.
Capitals of other regional countries have far greater numbers of lavish accommodations in multiple categories. Dhaka has nine five-star hotels and more are coming up in addition to four and three-star accommodations several times more in number than in our capital. Colombo and Kathmandu are dotted by luxury hotels in double-figures while Baku (now declared twin city of Islamabad) has as many high star-rated hotels.
The latest official attempt to build new hotels was made last year when the capital’s civic body Capital Development Authority outlined frameworks for two luxury hotels and identified locations. However, procedural bottlenecks brought the initiative to a pause. There have been media reports about interest evinced by friendly countries in constructing hotels through joint ventures, but these expressions of intent and interest have yet to evolve into substantive follow-up.
With the aim of spurring economic growth, the government must create all possible ease for national private enterprise in this field. This would, inter alia, further uptick business confidence in the hospitality industry in particular and services sector in general beyond the 12 percent improvement found by a study published by US firm Nielsen.
Early this year, the Competition Commission of Pakistan endorsed the entry of Nishat Hotels and Properties Limited in the federal capital’s hospitality market. As a newcomer the appearance of this national brand would expand the choice of national and global guests. The Nishat Hotels steps in at a time when the government looks determined to take the capital’s infrastructural credentials to the next level.
The Nishat Hotels, whose services are at par with those of multinational hotel groups, commenced its odyssey with elite St. James’s and Club in Mayfair, London. A subsidiary of the leading Nishat conglomerate, the Nishat Hotels subsequently established two opulent accommodations in Lahore. It is thought that this hotel chain with an edge of rich occidental experience would bring to Islamabad redefined hospitality products with a blend of boutique luxury style and highly personalized services. A trailblazer in environment conscious operations, this eco-friendly brand would also help achieve capital authorities’ vision of a ‘clean and green Islamabad.’
The venturing of new hotels in the capital’s hospitality market must be seen in the larger context of this sector’s contribution to the economy as hotels are strategic spaces and economic powerhouses. According to Statista, revenues in the hotel business in Pakistan are projected to reach $1.68 billion during 2025 while the market volume may reach $2.19 billion by 2029. The revenue is expected to show an annual growth rate of 6.91 percent. A World Bank study assessed the potential of visitor spending in Pakistan spiking to $30 billion by 2033 from $16 billion three years ago.
Under the government’s economic transformation agenda a resolute push for boosting the hospitality sector seems to be on the cards as the 13th Five-Year Plan (2024-29) terms harnessing the potential of hospitality business and tourism as “a new growth area.”
Thus with the aim of spurring economic growth, the government must create all possible ease for national private enterprise in this field. This would, inter alia, further uptick business confidence in the hospitality industry in particular and services sector in general beyond the 12 percent improvement found by a study published by US firm Nielsen.
While the government along with its investment facilitation body is desperate to attract investment from abroad, the key point is that the road to foreign investment traverses through facilitating our own businessmen.
