State Bank of Pakistan (SBP) Governor Jameel Ahmad has said that the nine-month, standby arrangement agreed with the International Monetary Fund (IMF) has improved foreign currency reserves of the country and largely resolved near-term issues pertaining to external sector of the economy.

Addressing a flag-hoisting ceremony to mark the 76th Independence Day at the SBP headquarters on Monday, Ahmad noted that the world economy remained under pressure in the near past that also resulted in an increase in inflation in Pakistan.

Those conditions were further aggravated by floods and delay in the IMF programme’s review, he added.

The SBP governor paid rich tributes to Quaid-e-Azam Muhammad Ali Jinnah and his companions who despite adversities led the freedom struggle and won an independent state for the Muslims of the subcontinent.

Citing the post-independence struggle without a central bank, he recalled the hostile circumstances the nascent state of Pakistan endured during its initial days and how it was made to rely on others in order to perform financial and banking activities.

Ahmad recounted the extraordinary achievements of the central bank during the last 76 years, particularly gaining the confidence of Pakistanis.

“Following the best international practices, the Monetary Policy Committee of the SBP is now an independent forum that decides about the monetary policy, keeping in view medium-term inflation targeting and the country’s economic conditions.”

The SBP also keeps abreast parliament of its targets and activities through annual and bi-annual reports since it is accountable to the people’s parliament and public. Besides, it issues the Financial Stability Review that highlights the main risks facing the financial system and assesses the resilience of the financial system to those risks.

Ahmad observed that the SBP was making significant strides towards digital banking, green banking and Islamic banking.

He specifically mentioned the issuance of a licensing and regulatory framework for digital banks in line with best international practices, growth of fintechs and practical efforts for transformation of the banking system into Shariah-compliant banking.

He also highlighted the development of next strategic plan, improvement in liquidity management and Shariah governance framework under the third, five-year strategic plan for the Islamic banking industry.

The SBP governor hoisted the national flag at the Independence Day celebration ceremony, which was largely attended by the senior management and other officials of the bank.

In addition, a special exhibition of Pakistani postage stamps titled “Pioneers of Freedom”, a series created by renowned artist Saeed Akhtar, was arranged at the SBP Museum.

Published in The Express Tribune, August 15th, 2023.

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