KARACHI: Federal Minister for Finance & Revenue, Muhammad Aurangzeb has asked banks to enhance their financing to priority sectors including IT, agriculture and SMEs for a sustainable economic growth and prosperity.
The Finance Minister on Tuesday visited the Pakistan Banks’ Association (PBA) and met with the Presidents and CEOs of the banks. The Chairman PBA, Zafar Masud provided an update on the progress of initiatives aimed at boosting the three key sectors of Agriculture, Small and Medium Enterprises (SMEs), and Information & Technology (IT) in Pakistan.
The discussion underlined the banking sector’s commitment to fostering financial inclusion in the Country.
During the meeting, the Finance Minister called on the entire sector to contribute to priority areas based on their size, capabilities, and unique strengths. He emphasized a return to fundamentals, urging banks to prioritize lending to farmers and increase cash-flow based lending. He expressed confidence in the banking sector’s ability to drive economic growth.
Regarding the IT sector, Aurangzeb advocated for supporting software houses and freelancers. Highlighting IT as a key growth driver, he stressed the importance of leveraging the substantial IT budget and encouraged banks to collaborate with the government to maximize and facilitate the IT sector.
Finance Minister highlighted the crucial role of the banking sector in driving economic growth and stressed that the banks should enhance their efforts in supporting priority sectors to foster economic development and prosperity. ‘‘The collaboration with SIFC and the focus on corporate farming are critical for our economic growth’’, he added. He said that it is encouraging to see the private sector taking proactive steps in advancing financial and technological infrastructure. The Finance Minister further said that extensive talk has been conducted on the macro aspect, but moving on the external financing front, the government is comfortable with the current situation.
“We are moving forward with the IMF draft resolution and we are aware of the current challenges. With the IMF’s core approval, we believe the situation is manageable”, he added.
He said that the agriculture sector, SMEs and IT industry, especially freelancers, needs proper fund allocation. It is time for private banks to step up in terms of financing and fund allocation, he added.
Aurangzeb said the development sector is facing issues with additional taxation, high energy costs, and high interest rates. The large-scale manufacturing sector is also facing challenges, but we are working on providing support where possible, he added.
During the session, Chairman PBA, Zafar Masud gave a comprehensive presentation on the developments in each sector. The proposals were developed in close consultation with SBP to ensure they effectively address the unique challenges and highlight the opportunities within each sector.
Masud said the PBA is taking decisive steps to work with the Ministry of Finance and the SBP in implementing these recommendations to enhance the banking sector’s contribution to Pakistan’s economy. The Finance Minister commended PBA’s Steering Committee, and the respective task forces for their thorough analysis and valuable recommendations.
The meeting was attended by Minister of State, Ali Pervaiz Malik, Chairman Federal Board of Revenue (FBR) Amjed Zubair Tiwana, Director to Minister Finance Shehryar Ahmad, Senior Vice Chairman PBA, Yousaf Hussain, Vice Chairman PBA Ahmed Bozai, CEO and Secretary General PBA, Muneer Kamal and CEOs of leading banks. Other senior officials from the PBA were also present at the meeting.
Copyright Business Recorder, 2024
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