IMF package to pave way for economic stability: Shamshad

HYDERABAD/KARACHI (AFP/APP) - State Bank of Pakistan Governor Shamshad Akhtar here on Tuesday said the rescue package of International Monitoring Fund (IMF) will help in maintaining economic stability in the country. In her presentation,"Economic Scenario of Pakistan", organised by Sindh Development Study Centre, University of Sindh Jamshoro, she said Pakistan was not only the country seeking help from IMF for its economic stability. Other countries have also approached the donor agencies for the same, she said replying to a question following her lecture. To stabilize economy of the country, the Micro Credit Stablization Package worth Rs. 26 billion is being introduced, said Dr. Shamshad Akhter. Responding to another question, she said that withdrawal of subsidy on various items has brought significant changes in the country's economy. The income to be received through privatization will also help in stablilizing the economy, she added. The Governor of SBP said that lowering of oil prices along with edible oil and other food items in the int'l market is also helping in the recovery of the country' economy, however, there is still need to make effective measures for further improving the situation. The State Bank of Pakistan has released Rs.320 billion to commercial banks of the country while efforts are underway to make changes in the exchange policy with objective to make it sounder, she said replying to a questioner. The SBP Governor denied of sealing of any account and said rumors regarding instability of the national economy held no root. Replying to another question, Shamshad Akhtar said that banking sector was intact and any company, found in violation of the rules and regulations will be penalized according to law. Earlier, the Governor State Bank in her lecture spoke at length on the economic condition of the country, devaluation of rupee and efforts being made by the government in bringing out the country from the economic crisis. She also replied to the queries of the audience by quoting current statistics pertaining to situation not only in Pakistan, but other countries of the world too. Meanwhile, economists and financial analysts in Pakistan Tuesday welcomed the International Monetary Fund's 7.6 billion dollar credit to the cash-starved nation, saying it would help stabilise the economy. "This development is positive and encouraging. It will certainly help the market to stabilise," Ahsan Mehnati, a stock market analyst, told AFP on Tuesday. Economist Rauf Nizamani said the IMF loan was important to improving Pakistan's prospects. "The country's economy was facing a serious lack of confidence, which this credit will certainly restore," Nizamani said. However he said the IMF loan condition that the government must cut development expenditure would affect growth and increase unemployment. Analyst Mohammad Imran said the local currency's strength would improve further when the IMF's first tranche of 4 billion dollars was received. "The IMF's move has been positive and we estimate that the rupee will gain further and stabilise between 73 to 75 rupees against the dollar," Imran said.

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