Saturday September 18, 2021

PM approves 5-year plan for boosting economy

ISLAMABAD: Prime Minister Imran Khan has approved 5-year plan for enhanced National Financial Inclusion Strategy (NFIS) during a meeting held at the Prime Minister’s Office (PMO) on Thursday.

He said that access to finance is critical to achieve sustainable and inclusive economic growth being prerequisite for equitable distribution of economic opportunities, poverty reduction and achieving financial stability.

The meeting was attended by Minister for Finance Asad Umar, Advisor to Prime Minister Ishrat Hussain, Secretary Finance Arif Ahmed Khan, Governor State Bank Tariq Bajwa and senior government officials. The NFIS lays out the national vision, framework, action plan and targets for financial inclusion in the country.

The prime minister was informed that Pakistan had one of the lowest levels of financial inclusion up until 2015. Only 16 percent of adult population had a bank account. The account ownership was even lower for women at 11 percent. Besides, a large number of population remained voluntarily excluded due to their religious and other concerns. It was informed that financing to priority sectors of economy i.e. agriculture, SMEs and housing have remained low due to less financial inclusion.

Governor State Bank Tariq Bajwa while briefing the prime minister about the future strategy for the next five years said that enhance usage of digital payments, enhance deposit base, promotion of SMEs and agriculture finance and enhancement of share of Islamic Banking constituted main areas to broaden the existing levels of financial inclusion.

It is envisioned that implementation of five years plan would translate into creation of 3 million jobs and additional exports of $5.5 billion through enhanced access to finance to SMEs. The plan also includes a strategy to increase the deposit base of banks to 55% of GDP and encourage higher savings. The plan also envisages reduced income tax on income earned by commercial and microfinance banks on SMEs, housing & underserved areas for priority sectors. Governor SBP also presented a detailed road-map with delineated timelines against each target being set under the Five Years NFIS.

The premier appreciated the efforts being made towards broadening financial inclusion. He said that the five years NFIS plan would facilitate citizens and the financial institutions, especially in priority sectors of economy, and would thus help realising the huge potential that existed in SMEs, agriculture and Islamic banking sector.

In the meanwhile, prime minister chaired meeting of task force on housing and discussed proposed legislation for Naya Pakistan Housing Programme (NPHP), the housing authorities established on federal and provincial echelons and real estate regulatory authority and relevant subjects. Prime Minister Khan instructed to extend the scope of NPHP to Azad Kashmir and Gilgit-Baltistan (GB). The programme will help in providing employment to the youth and accelerate economic activities.