Saturday June 10, 2023

Dr Baqir’s tenure ends in May; decision on extension still awaited

Sources say said efforts were underway for securing a second term for Dr Reza Baqir

April 29, 2022
SBP Governor Dr Reza Baqir. The News/File
SBP Governor Dr Reza Baqir. The News/File

ISLAMABAD: Dr Reza Baqir’s term as governor central bank ends next month, leading to speculation about whether or not the present coalition government of Pakistan Muslim League will choose to reappoint him or replace him.

Sources, however, said efforts were underway for securing a second term for Dr Baqir, a former executive of International Monetary Fund (IMF) and the government was likely to consider, “a few months’ extension in his tenure as a stop-gap arrangement”.

“The government might consider granting him an extension until a deal with the IMF is finalised,” a senior finance ministry official told The News on Thursday.

The three-year tenure of Dr Baqir is expiring on May 4, 2022 and he could be granted a second five-year term under the SBP law.

But a federal minister said in a television talk show that the government is unlikely to grant a second term to present SBP governor.

“Dr Baqir has established contacts with the current economic team and convinced them he could play an important role in resuming the stalled $6 billion IMF programme,” a source said.

Pakistan has also requested the IMF to extend the programme for another nine months and increase the loan amount to $8 billion from current $6 billion.

Another official confirmed to The News in background discussions that “some close confidants” including one businessman approached the PML-N’s top leadership in London and made an effort to convince them to give a second term to governor Baqir”.

“Senior political leadership of PML-N is not yet fully convinced to grant him a full-term extension.”

Sources further said the government was mulling “granting Dr Baqir an extension till the finalisation of the IMF programme”.

When contacted, Finance Minister Miftah Ismail declined to answer the query on Dr Baqir’s extension.

Dr Baqir was appointed as the central bank governor on May 4, 2019, for a period of 3 years.

Prior to this appointment, Dr Baqir had eighteen years of experience with the IMF and two years of experience with the World Bank.

He represents the State Bank of Pakistan on the Board of Directors of the Asian Clearing Union, the Board of Governors of the Economic Cooperation Organization Trade and Development Bank, the Council of Islamic Financial Services Board (IFSB), the Financial Stability Regional Consultative Group for Asia, and the IMF’s Board of Governors.

He has been appointed as Chairman of the General Assembly of the prestigious Islamic Financial Services Board for 2022.

Dr Baqir's academic research has been published in top journals of the economics profession, including the Journal of Political Economy and the Quarterly Journal of Economics.