ISLAMABAD: State Bank of Pakistan (SBP) Governor Jameel Ahmad, Wednesday, said that inflation is expected to remain around 11.5 percent while GDP growth is likely to be in the 2.5 percent to 3.5 percent range.
Talking to media here on Wednesday, the governor said that Pakistan’s current account deficit is likely to remain around one percent of GDP. He further said that inflation is expected to remain around 11.5 percent while GDP growth is likely to be in the 2.5 percent to 3.5 percent range.
The Senate Standing Committee on Finance and Revenue convened on Wednesday under the chairmanship of Senator Saleem Mandviwalla.
‘Fleecing by Islamic banks’: Senate panel seeks detailed briefing from SBP
The committee received a briefing from the governor of the SBP on the Islamic banking system. It was explained that Islamic banking is regulated by the Shariah Advisory Committee and the Shariah Compliance Department under the Shariah Governance Framework (SGF).
After a thorough examination of the Islamic banking mechanisms, the committee members concluded that further discussions are necessary to assess how Islamic banking is being regulated in accordance with Islamic principles.
The chairman requested a comparative report on the SBP regulations for Islamic and conventional banking. It was also noted that the mentioning of HIBA is missing from musharakah contract. The chairman expressed concern that banks are yielding higher returns through Islamic banking, suggesting that this might be a factor in its promotion. The committee urged the SBP to establish a mechanism that reflects the true essence of Islam as guided by Shariah.
The committee, unanimously, approved the government bill titled, “The Banking Companies (Amendment) Bill, 2024,” with amendments proposed by the committee.
Additionally, the private member’s bill titled, “The State Bank of Pakistan (Amendment) Bill, 2024,” introduced by Senator Mohsin Aziz, was also passed by majority, while Senator Anusha Rehman abstained from the voting on the bill. It was noted that the banking sectors in smaller provinces, particularly, Balochistan and Khyber-Pakhtunkhwa are having very negligible lending practices which have led to persistent deprivation and slow industrialization in these provinces
Furthermore, the additional finance secretary addressed the amendments to sections 14B and 14C of the Members of Parliament (Salaries and Allowances) Act, 1974, through the Finance Act, 2024, stating that it is the prerogative of Parliament to adopt these changes as deemed appropriate. The committee directed the Ministry of Finance to respond on the matter in three days.
A briefing on the current status of EXIM Bank was deferred due to the president’s absence. The committee expressed serious concerns about longstanding issues related to EXIM Bank. Members also suggested the possibility of dissolving EXIM Bank, as it has not contributed to export growth, which was its original mandate. The committee summoned the CEO of EXIM Bank for the next meeting to explain his departure.
Additionally, a briefing on the need for the FBR to hire audit firms, including the procedures and criteria involved, was discussed. It was noted that the current capacity for auditing six million taxpayers is insufficient, necessitating the short-term hiring of ACCA and CA professionals to facilitate effective audits, with a requirement for 4,000 hires.
The chairman remarked that the FBR had previously outsourced audit functions in 2005; however, reputable firms are being sought for individual. The committee emphasised the need for a completely transparent hiring process.
Attendees included senators, Sherry Rehman, Mohsin Aziz, Anusha Rahman Ahmad Khan, Syed Shibli Faraz, and Manzoor Ahmed, along with senior officials from relevant departments.
Copyright Business Recorder, 2024
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