(MENAFN - Khaleej Times) The federal minister mentioned that it was the first time that the government had listed treasury bills for trading on the stock exchange
Pakistan has invited middle eastern banks to invest in the treasury bills (tbs) of pakistan in the stock exchange that will yield attractive dividends for the lenders.
The proposal was floated by the federal minister for finance economic affairs revenue and statistics senator muhammed ishaq dar to representatives of mostly dubai-based banks during a meeting in dubai. representatives from dubai islamic bank mashreq bank emirates islamic habib bank ltd habib agz bank emirates nbd and united bank limited attended the meeting.
The federal minister during his briefing mentioned that it was the first time that the government had listed treasury bills for trading on the stock exchange.
Senator dar cited that in the 90s credit facilities were extended by the middle eastern banks to pakistan. he mentioned that one such facility had been extended recently as well. the minister encouraged the bankers for resumption of similar financing facilities as the fast growing pakistani market has good appetite for such credit.
According to media reports in pakistan dar is in dubai to hold the first roadshow with expectation to raise 500 million projected in the current fiscal year budget to meet fiscal deficit financing. the government has estimated rs576 billion external resources grants and loans as well as 500 million eurobonds and 800 million privatisation proceeds for financing the fiscal deficit.
Three road shows have been planned to launch eurobonds in the current fiscal year with the first one in dubai followed by one in london on april 4 and the last one in new york prior to the world bank and the international monetary fund (imf) spring meeting scheduled for april 11-13 reports said.
Giving a detailed review of pakistan’s economy to the representatives of the banks the minister said that the present government was following economic reform agenda and nearly all the economic indicators were on track.
Last week the international monetary fund (imf) appreciated the growth momentum in pakistan’s economy and confirmed its recent forecast of 3.1 per cent growth this year which was revised up from an earlier 2.8 per cent.
The overall economic situation in pakistan is gradually improving according to jeffrey franks the imf mission chief for the country. “that 3.1 per cent may still be a bit on the conservative side so we see indicators of growth that are relatively strong considering the fiscal adjustment that has taken place” franks said during a conference call.
The imf projected that pakistan’s growth to accelerate to around 3.7 per cent for the 2014-15 fiscal year. the growth was boosted by a stronger manufacturing industry according to an imf report.
In the first half of the financial year large-scale manufacturing had shown a growth of 6.8 per cent which was leading the overall growth in the economy dar told bankers.
He further said that the growth in credit to private sector had shown a phenomenal increase of 8.7 per cent for the period july-march 2014 over minus 0.8 per cent in the last financial year.
Dilating on the external front the finance minister said that exports were showing positive results with a growth of 6.2 per cent year-on-year for the period july-february.
The finance minister said that remittances showed an increase of 11.2 per cent higher than last year which was helping balance of payment position.
Latest data shows that the foreign exchange reserves of the country have crossed the threshold of 10 billion on march 31 as the government has strengthened the foundation of the economy.
Dar also highlighted that the expenditure management had helped in reducing fiscal deficit during july-february 2013-14 to 3.1 per cent against 4.1 per cent during the same period of last year. revenue collection during july 2013-february 2014 also showed a healthy growth of rs1348 billion compared to rs1145 billion for the same period last year indicating an increase of 17.7 per cent.