Lahore Gymkhana sits on Rs218bn state land for Rs5,000 a year

LAHORE: Government records show that the Lahore Gymkhana, established in 1913, occupies prime state land in central Lahore under a long-running lease carrying an annual rent of Rs5,000, while questions have also been raised over additional land use, construction approvals and public funding.

According to a repport by Dawn, the club stands on state land bounded by The Mall, Jail Road and Zafar Ali Road. Its original lease dates back to the colonial period and was extended in 1921, 1960 and again in 1996, five years before expiry. The last extension covered the period from 2000 to 2050 for 50 years.

The estate covers 112 acres and that the club is also holding three kanal and 16 marlas more than the record of rights permits. The Gymkhana uses a cricket ground spread over three-and-a-half acres inside Lawrence Gardens, now Bagh-e-Jinnah, on land belonging to the Agriculture Department. That parcel was not part of the lease, no grant exists for it and no rent is being paid.

Rent, valuation and policy framework

For the main estate, the club pays Rs5,000 a year in total rent. It calculated that this amounted to roughly Rs417 per month, or less than 50 paisas per kanal, for land in one of the province’s highest-value locations. Using an upper commercial rate of Rs200 million per kanal, the land’s market value is estimated at Rs218.2 billion and fair annual rent at about Rs4.364 billion.

Under the government’s 2023 policy, clubs could pay one-tenth of market rent, which in this case would still amount to around Rs400 million a year. The Lahore Gymkhana continues to pay Rs5,000 annually because its lease predates the policy.

In May 2023, Punjab’s caretaker government approved a policy through the Colonies Department allowing prime state land to be given to gymkhana clubs across the province at one-tenth of market rent. Citing the Board of Revenue, annual rates after the 90 per cent reduction include Rs20,000 per acre in Dera Ghazi Khan, Mandi Bahauddin and Chiniot; Rs50,000 in Vehari, Sahiwal and Dera Ghazi Khan; Rs60,000 at Kamalpur Syedaan in Attock; Rs100,000 at Saddar Gymkhana, Gujranwala; Rs120,000 in Jhang; and Rs140,000 in Jhelum and Gujranwala City.

Approvals, arrears and official records

As per Dawn's report, the club submitted a defence before the Punjab Assembly in which it acknowledged that several structures were built after the lease and that the lease required prior government approval for construction. These structures include the clubhouse, golf clubhouse, swimming pool, two guest blocks, health club, administration block, mosque and a café built in 2012.

The Board of Revenue searched for approvals for those constructions but found none on record. The club had not paid even the nominal annual rent for years, adding that the Additional Deputy Commissioner’s office issued a notice dated Aug 26, 2020, stating that rent had not been paid since 2011.

On access to information, citizens sought lease and donor records under the Right to Information law, but the club refused to provide them and challenged the matter in the Lahore High Court, arguing that as a public limited company it was not a public body. The court dismissed that plea in January 2023. The judge held that the land belonged to the state and that granting land worth billions of rupees on such terms was a substantial public benefit.

Public grants and membership structure

The club denied receiving public funding but in the same submission listed state-backed grants: Rs2 million from president Gen Zia in 1985, Rs2 million from prime minister Nawaz Sharif in the same year, Rs50 million from chief minister Pervaiz Elahi in 2006, and Rs10 million from chief minister Shehbaz Sharif in 2014.

The club’s rules allow every civil servant in Grade 18 and above to become a member for a nominal fee, as well as all commissioned officers of the armed forces. Membership may also be inherited, while the roll of ordinary members was treated as confidential when sought by the Punjab Assembly.

Wider pattern cited in the report

Similar arrangements existed at other elite institutions on public land in Lahore, including the Punjab Civil Officers Mess in the GOR, the Punjab Club and the Lahore Polo Club inside Race Course grounds, as well as Aitchison College, which spreads over 200 acres.

It also referred to Islamabad, where the Islamabad Club occupies 352 acres of CDA land and pays around Rs3 per acre per month. The Gun and Country Club was built on land meant for the Pakistan Sports Board and the Supreme Court in 2018 declared it illegal and ordered the land recovered. Auditors later could not trace about 38 acres and the club occupied roughly 37 acres without a deed, lease or licence.

A proposed move in Multan to carve out 15 acres from the Central Cotton Research Institute for another gymkhana was mentioned. The institute was founded in 1970 and had developed more than 40 cotton varieties, including the region’s first virus-free strain, while the Pakistan Business Forum had written to the chief minister asking that the move be stopped.

Finally, a 2021 UNDP estimate stated that privileges captured by Pakistan’s elite through cheap land and capital, tax breaks and subsidised inputs amounted to about $17.4 billion annually, or nearly six per cent of the economy.