KARACHI: Pakistan’s finance minister Ishaq Dar on Thursday allowed a charity organization operating in the country to voluntarily raise about $2 billion in debt to support the national exchequer amid ongoing economic turmoil.
Addressing a gathering on the Islamization of economy, Dar told the chairman of Saylani Welfare International Trust, Bashir Farooqui, he was free to generate money from overseas Pakistanis by utilizing his network. However, he said all the transactions must be kept transparent.
“The transactions must be transparent and well documented and the money must be raised under the defined procedures,” the minister said while participating in the gathering through a video link from Islamabad.
Farooqui had sought permission from Dar to generate the required amount during the course of the program.
“The debt will be raised for five years and will be interest-free,” he said. “The collected amount will be handed over to the government.”
Pakistan is currently facing an acute dollar liquidity crunch with official foreign exchange reserve down to $3.6 billion against the average import cover of $5 billion.
Responding to the Saylani Welfare Trust chairman, the finance minister asked him to coordinate with the central bank to determine the contours and mechanism of the proposed scheme while directing State Bank of Pakistan (SBP) officials to facilitate and record any inflows through meticulous documentation.
Dar also said the subject of Islamic economic system came very close to his heart, adding that he prayed for the elimination of interest-based financial environment.
“One of the actions taken in this regard has been the formation of a high-level steering committee consisting of all key stakeholders, including the finance ministry and central bank officials, Securities and Exchange Commission of Pakistan and Shariah experts,” he said.
Pakistan’s Federal Shariat Court (FSC) directed the government last April to eliminate riba – or interest – within five years.
Dar maintained it was possible to Islamize Pakistan’s economy even before the given deadline.
“There is no reason why we can’t achieve the Islamization of economy before five years,” he said.