Salman said around Rs 11 billion were released from Rs 50 billion for Swat operation and Rs 2 billion for Waziristan operation. About quarterly fiscal deficit, he said it was 1.5 percent for the first quarter, higher than set in the budget, but said, delay in advance taxes, release of advance salaries to the public sector employees and non-payment of Rs 42 billion due since September for Coalition Support Fund was the cause of this high fiscal deficit for the first quarter.
Salman said the International Monetary Fund would be informed about these inevitable reasons for higher fiscal deficit for the first quarter in the upcoming scheduled talks for third review of Pakistan economy under Stand-By Arrangement (SBA) in Dubai from November 2 to 12.
He said the ongoing projects would be considered for release of amount under the Kerry-Lugar Bill for the ongoing fiscal year which have already been submitted to the Friends of Democratic Pakistan (FoDP). To a question about the National Finance Commission (NFC), he said that next meeting would be held as per schedule in Peshawar on October 29 to 30 and was optimistic that all the issues for horizontal and vertical distribution would be resolved amicably. So far, he said there was consensus as to what should be the yardstick for distribution of resources among the stakeholder with government giving clear indication for making investment in literacy, health, water and sanitation.
Earlier, the Committee on Finance and Revenue met under the Chairpersonship of Fauzia Wahab and discussed the Anti-Money Laundering (Amendment) Bill 2009, and the Banking Companies (Amendment) Bill 2009 in the Parliament House.
Secretary Finance said an amendment in Anti Money Laundering Bill is needed to meet requirements of lending institutions. He said that the proposed amendments address and broadly provide for AML law's applicability in the area of financing of terrorism; expansion in the list of predicate offences and modifying the definition of money laundering, in line with the internationally accepted standards.
While explaining amendment in Banking Companies (Amendment) Bill 2009, he said that one of the actions required by the IMF in Memorandum of Economic and Financial Policies (MEFP) in the Current IMF Programme for Pakistan includes strengthening of the SBP's ability to take measures for banks supervision.
The recent financial crises world-wide have clear linkages with weak supervisory regime. The changing dimensions of banking business continue to create newer challenges and risks for bank depositors, regulators and financial system as a whole. The existing law provides these powers in one form or the other. However, there is need to bring coherence and certainty in measures to deal with the troubled situations. This would ensure enhanced confidence in the system through stability and soundness of the banking sector.
The committee deliberated and examined thoroughly clause by clause proposed companies ordinance bill designed for giving more power to the regulator, State Bank of Pakistan. The meeting was attended by Nafisa Shah, Khawaja Muhammad Asif, Munir Khan Orakzai, Kashmala Tariq, Shahid Khaqan Abbasi and Arif Aziz Shaikh, besides officials of the Ministry of Finance and the State Bank of Pakistan.
Copyright Business Recorder, 2009