Pakistan tells IMF proposed amendment bill for central bank autonomy in conflict with constitution

ISLAMABAD: Pakistan's law minister Barrister Farogh Naseem briefed International Monetary Fund (IMF) officials via video link on Monday, saying several provisions of the proposed State Bank (Amendment) Bill 2021 were in violation of the country's constitution, local media reported.
The government introduced a legislation in March to grant unprecedented autonomy to the country's central bank to meet a major IMF demand. The country's former finance minister Abdul Hafeez Shaikh promised to "fast-track" the legislation, as he said the IMF board would soon meet to review Pakistan's economic performance before releasing the next tranche of a $6 billion bailout package.
State Bank of Pakistan (SBP) Governor Reza Baqir also defended the autonomy bill, saying it would help the country "get rid of the boom-bust cycles" which happened every two to three years due to the short-term economic policies.
"Law Minister Barrister Dr Farogh Naseem has said that the proposed Section 46B(8) in the State Bank (Amendment) Bill 2021 is violative of the Constitution," said a report in daily Dawn, referring to a provision requiring consultations with the central bank on any legislation related to it. "The legislative power has been conferred by the Constitution on the parliament, and the Constitution does not provide for any consultation with the SBP prior to passing of any legislation, he explained."
The minister informed the IMF officials such a provision was likely to be struck down by courts.
He also mentioned the proposed Section 15(1) of the bill that says the governor, deputy governors and other top SBP officials cannot be removed on grounds of misconduct, pointing out that it was against Article 25 of the constitution which ensures equality of all citizens.
Naseem told the IMF officials that even judges of superior courts could be removed for misconduct under Article 209 of the constitution.
He also questioned the provision that protects top SBP officials from the proceedings of the country's anti-graft National Accountability Bureau.
The Pakistan-IMF talks, which started last month, were scheduled to conclude by October 15. However, the two sides continued their consultations amid speculations of a deadlock.
The country's finance chief Shaukat Tarin said on Monday the accord between the two for $1 billion tranche would be signed "this week."
The Pakistani law minister told the IMF officials it could take several months to get parliamentary approval for the proposed SBP bill, adding it could not materialize in the short terms as the Fund wanted.