Pakistan News

Musharraf inaugurated First Micro Finance Bank in private sector

ISLAMABAD, March 12 (PNS): President General Pervez Musharraf Monday said that the policy of his government of orderly financial development in the country would even continue beyond October next.While inaugurating First Micro-Finance Bank in the private sector by the Aga Khan Rural Support Programme and the Aga Khan Fund for Economic Development here, he said, "the government provided legal supervisory and regulatory arrangements to ensure orderly development of financial sector."

Prince Karim Aga Khan, spiritual leader of Ismaeli Sect of the Muslims, Finance Minister Shaukat Aziz and other senior civil and military officials were also present on the occasion. "The government has provided a conducive policy framework and support mechanism to encourage private investment in the micro finance sector," Musharraf said.

The President said it is now for the private sector and development organizations to take advantage of these policy measures and contribute towards real poverty eradication in Pakistan. "The establishment of Micro Finance Bank is a major private sector investment in Pakistan and will encourage other domestic and international entrepreneurs to invest in Micro Finance sector".

He was confident that this bank will contribute very positively and substantially the access of the poor to micro finance services.

General Pervez Musharraf said immediately after taking over, the government focused on strategic areas of economic revival, good governance, political restructuring and poverty alleviation. In fact poverty alleviation formed the focus of the strategy towards the well being and progress of the country. He said this poverty lies in rural areas, urban educated and uneducated unemployed. "To overcome this problem, the government economic revival programme concentrated on agriculture, information technology, small and medium industry and energy sectors".

He said the agriculture sector provides fastest development and employment to 70 percent of the rural poor. The information technology addresses unemployment of the educated unemployed in urban areas while small and medium enterprises jobs to the uneducated and helps in economic revival, he observed.

"In addition, the government has launched the new Zakat strategy, Khushaal Pakistan programme, food support and nutrition programme for girls".

Turning to the measures taken by the government to address the issue of micro financing, the President said the government designed the micro finance policy in June 2000 and facilitated the establishment of Khushaali Bank. This Bank is expanding its operations to 30 districts and will target one lakh households every year.

"To build social capital for the poor, a micro finance social development fund of dollars 40 million has been set up in addition to community investment fund of dollars 20 million to increase access of the poor to micro financing. A risk mitigation fund of dollars 5 million has been created to assist the poor in case of unforeseen loss of the income. Dollars 12 million have been provided for institutional strengthening of micro finance institutions".

He said to complement efforts of micro finance institutions, the government is restructuring the Agricultural Development Bank of Pakistan to focus on rural economy and sustenance of the poor. He said all this has been achieved in a period of less than 18 months. The pro-poor progressive system is moving forward and would continue even in the years ahead, he said.

General Pervez Musharraf appreciated the gesture of Aga Khan Foundation in supporting government's poverty eradication efforts. He expressed his extreme appreciation for the concern, involvement and commitment that Prince Karim Aga Khan always showed towards Pakistan and its people. The spiritual head of the Ismaeli community, Prince Karim Aga Khan praised the government policies to achieve a turn around and managing the economy. The favorable policy environment and private sector initiative in this field will work for the benefit of the needy in Pakistan, he said.

Aga Khan, who arrived Islamabad on Saturday on a five-day visit, has said the decisions taken by the government will pave the way for brighter future of Pakistan and the Ummah.

He offered the government of Pakistan fullest support of his person as well as institutions of Aga Khan Foundation in the development of the country and poverty eradication. He said he will seek to encourage other international and multi lateral organizations to engage with the development institutions dedicated to alleviation of poverty in Pakistan.

He said the first Micro Bank will serve not only in rural areas but also major population centers and by June this year establish branches in Karachi and Rawalpindi. He thanked the government for extending full support to the establishment of the Bank and said it is yet another sign of steadfast support and encouragement that the government is giving to the activities of Aga Khan Foundation.

The Chairman of the First Micro Finance Bank, Sultan Allana in his welcome address said that the initial paid up capital of the bank is Rs.500 million with authorized capital of billion. He said the institution aims at reaching out to those who are currently not able to receive adequate financial services. The bank will target under served population, he said.