The International Monetary Fund (IMF) has called for greater autonomy for the State Bank of Pakistan (SBP). This demand comes as part of the IMF’s recent Governance and Corruption Diagnosis Assessment Report.
The IMF recommends changes to the State Bank Act. One key suggestion is to remove the federal secretary of finance from the SBP’s Board of Directors. This change aims to reduce government influence and promote impartial decisions.
The report also highlights that two out of three deputy governor positions at the SBP remain vacant. The IMF stresses the need to fill these posts quickly to strengthen the bank’s capacity and oversight.
In addition, the IMF urges Pakistan to end government interference in supervising commercial banks. The fund believes that full independence for the SBP is necessary to properly regulate the financial sector.
Officials from Pakistan’s Ministry of Finance have confirmed that talks with the IMF are ongoing. These recommendations are expected to be part of broader negotiations related to loan disbursements and reforms.
Granting more autonomy to the SBP aligns with global best practices. The IMF believes this will improve transparency and governance at the central bank. It is also seen as a step toward better economic stability in Pakistan.
The IMF’s call for reforms comes amid continued discussions between Pakistan and the fund. How Pakistan responds to these demands may affect its future financial support.
In summary, the IMF emphasizes the importance of an independent State Bank. It also focuses on reducing political influence to ensure sound monetary policy and financial sector regulation. The reforms could play a vital role in Pakistan’s economic progress and international relations.
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