ISLAMABAD: A meeting of the Senate Standing Committee on Finance expressed serious concern over the absence of governor State Bank of Pakistan (SBP) from the meeting, when an important issue pertaining to the SBP was brought up for discussion.
The meeting of the committee presided over by Senator Talha Mahmood was moved an agenda items pertaining to an issue being faced by the Iraqi Embassy in Islamabad, in managing US$10 million account with a bank.
As soon as the agenda was taken up, the chairman of the committee was informed that during the month of June 2021, the SBP (Exchange Policy Department) received a special request from HBL, on account of their client, the Embassy of Iraq, Islamabad; (i) allow for monthly transfer of salaries of US$ 100,000 to FCY accounts of their foreign national employees; (ii) allow monthly withdrawal of US$ 100,000 for travelling abroad purposes; (iii) allow receiving and retaining cash deposits up to US$ 1,000,000 on monthly basis in Embassy’s FCY account, on account of visa fees, document attestation charges, and consular service fees, in form of foreign currency from respective applicants.
The meeting was, in writing, informed that with respect to requests at points (i) and (ii), the SBP allowed the HBL for monthly transfer of FCY for payment of salaries only to their foreign national employees and monthly cash withdrawal on account of travelling abroad purposes (funds to be used out of Pakistan) whereas, with respect to the request at point (iii), it was advised to the said bank that there is already a mechanism in place whereby foreign embassies/consulates operating in Pakistan, collect visa/consular fees etc in their Pakistani rupee accounts.
Subsequently, the fees so collected may be repatriated to their respective home countries, after seeking approval from Foreign Exchange Operations Department (FEOD), the SBP-Banking Services Corporation through their authorised dealers.
However, the HBL has requested the SBP to reconsider the request of Iraq Embassy. During the committee meeting, when a representative of the SBP, (an executive director) presented the letter of the governor SBP, explaining his absence, Senator Mahmood ripped the letter and tossed it in the air before the committee.
The meeting, while taking up the agenda items taking serious notice of the absence of the governor SBP, observed that it can order the police to present the governor before the committee after arresting him. The chairman of the committee stated that he can give an order to the police to arrest and bring the governor to the committee.
“We have the powers to summon the governor SBP and move privilege motion against him,” Senator Mahmood stated.
He further stated that if anything happened to their money, an FIR would be filed against the governor SBP. Senator Saleem Mandviwalla said that the governor SBP did not appear in the last three meetings of the committee, whereas, the Iraqi ambassador has appeared in the committee.
Senator Sherry Rehman said that the committee should take serious notice of the absence of the governor SBP. “It is unacceptable and the governor should face the privilege motion,” she added.
Musaddiq Malik also pointed out that the Ambassador of Iraq is representing his country in the committee and wanted that a privilege motion should be moved against the governor SBP. The bank is allowing the embassy to deposit US dollars, but cannot allow to withdraw the amount in dollars to pay salaries to the employees of the embassy.
The Iraqi ambassador in Islamabad briefed the committee about the difficulties being faced, while dealing with the bank, and stated that in Pakistan, the Iraqi Embassy is taking money in dollars and Pakistani Embassy in Iraq is also dealing in dollars on a reciprocal basis.
The Iraqi embassy is providing all services including visa services in dollars in Pakistan. He said that there are US$10 million deposited in the private bank for the last 10 years, while officials of the private banks stated that the embassies cannot keep dollars or any foreign currency in their accounts.
Upon this, the chairman said that the SBP should resolve this problem and directed the executive director of the SBP to speak to the governor and let the committee know about his response. After talking with the governor SBP, the SBP official conveyed the message of the governor to the chairman of the committee.
Senator Mahmood informed the committee that the governor SBP has assured the committee that the matter of the Iraqi Embassy would be resolved on top priority basis. The issue would be sort out in a week and the SBP will also have a meeting with the Iraqi ambassador to resolve their issues.
Copyright Business Recorder, 2021