Time for mending US Pakistan relationship

It is becoming visible that the US administration has already started applying undue pressure on Pakistan. The Foreign Secretary is scheduled to visit Pakistan during first week of September. In the past the US mantra was ‘do more’, which is likely to get louder as the newly elected government has taken charge.

The first evidence came when the US issued instructions to the IMF to be more cautious in lending money to Pakistan. Ironically this announcement came without taking into account many ifs and buts. The recent handout of the US administration further spoiled the already deteriorating relationship. It has therefore become imperative for the US administration to revisit its foreign policy towards Pakistan.

Let it be clearly understood by the US administration that the public pressure on the government has been on the rise to bid farewell to the US proxy war in Afghanistan. The masses now openly ask the reasons for the presence of thousands of troops in Afghanistan, the US had announced to pull out its troops from Afghanistan by 2014. Even at that time I had written a blog that troops will stay in Afghanistan forever and the prediction came true as the number of troops has increased rather than reducing.

I had also written that the US has lost war in Korea and Vietnam in the past and was on losing spree in Iraq, Syria and Afghanistan. The US must accept its defeat in Afghanistan and pull out its troops immediately. The newspaper reports indicate that more and more area of Afghanistan is being recaptured by anti US fighters, enjoying the support of local population. The control of Afghan regime that shrank to Kabul is now shrinking to Presidential Palace only.

Many geopolitical analysts have the consensus that after the decision to pull troops the US administration is getting jittery about the safety of its soldiers as well as military hardware. It can’t be ruled out that the anti-US forces may allow evacuation of troops in exchange for military hardware. The hardware that was accumulated in Afghanistan in more than four decades can’t be moved out in weeks or months. The US had used Pakistan backed fighters in repulsing USSR troops and again expects Pakistan to provide a shield as the retreat of troops and military hardware starts.

The analysts fear that retreat may not be as easy as being perceived by the US administration. I am sure that the US administration is fully cognizant of the fact the Anti US fighters are now backed by global and regional super powers and all of them would not like to miss the opportunity to settle their accounts. The real issue is that the US troops can’t move an inch without the local support as they are not familiar with the terrain. This inadequacy was one of the prime factors of the US defeat in Korea.

Establishing peace in Afghanistan is as not as easy as being perceived by the US administration. The presence of local war lords and fighters supported by the US troops make the jigsaw puzzle more complicated. One of solutions, which may not be acceptable to the US administration, is destruction of all the US owned military hardware in Afghanistan. However, it creates a situation chicken or egg first.

For the safe exit of the US troops and avoid anarchy/civil war after the departure of US troops, the US must consider destruction of military hardware. It is also suggested that Pakistan should not get involved in any adventure. The US has started the war in Afghanistan and it will have to ensure peace after the withdrawal of its troops. Trillions of US dollars, tax payers’ money, have been wasted in four decades. If the British crown can let its colonies get independence why can’t the US accept it defeat and pull out troops from Afghanistan, Iraq and Syria?

Examining the likely facets of Pakistan’s new foreign policy

The stage is being set for the oath taking of Imran Khan as Prime Minister of Pakistan. Concurrently the names to head finance, foreign affairs and defense ministries are being finalized. These three ministries are critically important as these will set the pace of economic development and contain cross border terrorism.

In one of my earlier posts I have outlined the top priorities for Asad Umar, the finance minister in waiting. While he is expected to keep his focus on two prime deficits, budget and trade, the influx of foreign exchange to meet debt servicing will be dictated directly by foreign policy. Most probably funds will be released on the instruction of Saudi Arabia and United States or China will have to extend more loans to facilitate Pakistan payoff loans obtained in the past.

The US, which in the past had been more than gracious in advising International Monetary Fund (IMF) to lend money to Pakistan, now seems very hostile. In the prevailing scenario, Pakistan has no option but to approach other friendly countries, Saudi Arabia and China that can extend soft-terms loans to avoid default.

Reportedly, Islamic Development Bank (IDB) has been instructed by Saudi Arabia to lend US$4 billion to Pakistan after Imran Khan takes oath as country’s next prime minister. The offer was made immediately after a statement by Asad Umar that Pakistan would decide on whether to seek a bailout from IMF or friendly nations such as China and Saudi Arabia. A point yet to be clarified is whether the loan by IDB would be in addition to a three-year US$4.5 billion oil financing facility for Pakistan activated in July 2018.

Umar has expressed intention to seek a US$12 billion bailout package from IMF. However, after the response of the US president, other contingency arrangements have to be made. The PML-N government, which also enjoyed godfathering of Saudi Arabia, has left Pakistan with huge burden of external loans resulting in balance of payment crisis and massive depreciation of Pak rupee.

It goes without saying that global and regional super powers have special interest in Pakistan. The US is heavily dependent on Pakistan for logistic support for the combat troops stationed in Afghanistan. Pakistan also provides transit facilities to Afghanistan. In the prevailing scenario ‘do more’ mantra of the US goes on but it can’t afford to antagonize Pakistanis to disrupt NATO supplies. Despite being a super power, the US suffers from ‘bitten once shy twice’ situation that happened after attack on Salala post.

While the US considers Pakistan a partner in war against terrorism only, China has substantial economic interest in Pakistan. At no point in time China can afford a situation where pace of work on China Pakistan Economic Corridor (CPEC) may be jeopardize. Over the last one year Chinese loans have kept Pakistan afloat and support of any magnitude in the future can’t be ruled out. As the economic interest of China grows in Pakistan, it will also have to extend military support to save the country from any aggression. While President Trump may not be aware of this fact but the US administration is fully cognizant that any retaliatory move will allow China to get sold footing in Pakistan.

Whether people accept it or not, Saudi Arabia, India and Iran are three regional super power and all the three wish to maintain cordial relationship, but at their own terms. A past mistake of India to bid farewell to Iran-Pakistan-India gas pipeline project has caused it colossal losses. Even investment of millions of dollars in the construction of Chabahar Port in Iran by India has not provided it and efficient and effective access to Afghanistan. India is keen on the construction of Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline, which will also pass through Pakistan. Therefore, India is obliged to maintain minimum working relationship with Pakistan. In this endeavor it is support by Iran also.

Maintaining cordial relationship with Iran and Saudi Arabia is a must for Pakistan. The country can’t afford any hostility with either of the countries because it encourages terrorists to use its province, Baluchistan for cross border terrorism under the disguise of Baluchistan liberation movement. Some of the quarters allege that in the past terrorist using Baluchistan as safe sanctuary were provided fund and arms by the US through the courtesy of Saudi Arabia.

Saudi Arabia has enjoyed good relations with Nawaz Shariff and its concerns with the change of government are natural. Imran Khan has expressed to adopt a more independent course and also expressed willingness to mediate in improving relationship between Saudi Arabia and Iran but, it becomes a nightmare for Saudi Arabia that Pakistan develops cordial relationship with Iran.

In a phone call with Iranian President Hassan Rouhani, Khan has accepted an invitation to visit Tehran. Reportedly, Saudi Crown Prince has also expressed intention to visit Pakistan soon in a bid to strengthen bilateral relationship.

“We want to improve ties with Iran. Saudi Arabia is a friend who has always stood by us in difficult times. Our aim will be that whatever we can do for conciliation in the Middle East, we want to play that role. Those tensions, that fight, between neighbors, we will try to bring them together,” Khan said.

It is not an easy situation for Khan to handle. Saudi Arabia has welcomed US President Donald Trump’s withdrawal from the 2015 nuclear agreement that curbed Iran’s nuclear program and his efforts to economically strangle the Islamic republic with harsh sanctions.  Saudi Arabia has not forgotten that Pakistan’s parliament rejected in 2015 a Saudi request to authorize Pakistani troops to participate in its troubled military campaign in Yemen.

Appointment of Ms. Shirin Mazari as Defense Minister, also becomes a source of concern for the monarchy. She had openly criticized in a series of tweets the fact that Pakistani general Raheel Sharif commands the 41-nation, Saudi-sponsored Islamic Military Counter Terrorism Coalition (IMCTC). She had asserted that Pakistan should not cooperate in Saudi Arabia’s alleged pursuit of a US agenda and should instead forge ties to Iran and India.

Khan will have to follow the collective wisdom of maintaining cordial relationship with global and regional powers. However, he will also have to safeguard Pakistan’s sovereignty. Pakistan should not be made subservient to any country for seeking bailout packages. He will also have to nurture the culture of living within means, rather than enjoying extravaganzas on borrowed money.

United States leading wars around the globe

Just the other day I received this article in my mail box. I read it repeatedly and then decided to share with my readers. Many people outside Pakistan may have read it but still I want more people to read this.

Our attention has focused for the past 18 months on the alleged Russian interference in the 2016 election. If true, these seemingly heinous acts are said to strike at the very roots of American democracy. Understandably so. Someone spending $95,000 to prise out of the Democratic National Committee vaults details of how Debbie Wasserman-Schultz tried to rig the primaries in Hillary Clinton’s favor constitutes a grave threat to the integrity of the American electoral process. When we add to that offense the outrageous release of the transcript from Ms  Clinton’s highly lucrative chat with the financial heavies at Goldman Sachs, our heads swoon at the audacity of the perpetrators. So dense is this thicket, so heavily freighted with consequence, that the most diligent mind struggles to absorb it all during the lazy dog days of summer.

                       An effort to escape from this unnatural burden led me to boldly take the risk of flying UNITED toward a salubrious destination. The serenity of those ‘friendly skies’ provided the leisure to contemplate other recent news – in particular, the doings of the United States in upholding the principles of national sovereignty and political freedom elsewhere in the world. A short list of the places where we have been active follows.

Cheers

Michael Brenner

mbren@pitt.edu

1.       In ENGLAND, Trump aggressively promoted Boris Johnson as a brilliant leader despite his direct challenge to Prime Minister Theresa May last week.

2.      Also re. ENGLAND, Sam Brownback, the US ambassador for international religious freedom, protested to the British Ambassador the jailing of racist agitator Tommy Robinson who targets Muslims

3.       In SCOTLAND, Trump lashed out at Nicola Sturgeon, the leader of the Scottish National Party, with a barrage of highly personal insults.

4.       In GERMANY, Trump has striven to weaken the position of Chancellor Angela Merkel through denunciations of her judgment and domestic policies

5.       IN POLAND, the Trump administration has lent its full support to the ultra-nationalist, anti-democratic government when it was facing opposition to its autocratic moves

6.       In HUNGARY, it has done the same in support of Prime Minister Viktor Orban

7.       In SAUDI ARABIA, Trump warmly embraced Crown Prince Mohammed ben-Salman despite his shake-down of other Saudi leaders and dangerous crack-down on the Shi’ite community

8.       In ECUADOR, Washington has encouraged current Prime Minister Lenin Moreno to pursue a vendetta against former President Rafael Correa because of the latter’s social democratic policies and unwillingness to kow-tow to American business interests

9.       In NICARAGUA, the United States is backing the campaign to overthrow the democratically government of Daniel Ortega

10.   In BRAZIL, the Trump administration gave its full public backing to the ‘constitutional’ coup against Prime Minister Dilma Rousseff because of her independent foreign policy line on issues that went against the grain of American policies and her mild challenge to American financial interests

11.   In ARGENTINA, the CIA/FBI connived with political foes of then president Cristina Kirchner to resurrect long discredited accusations that she was implicated somehow in the 1994  bombing of a Buenos Aires synagogue ascribed (probably falsely) to Iran. That contributed to her loss in a run-off to  Mauricio Macri – scion to one of Argentina’s biggest fortunes and graduate of Columbia Business School. 

The week after his inauguration Macri flew to New York to cede $6.5billion dollars to Wall Street hedge funds which had speculated in Argentine debt in 2001 and was being hotly contested in the courts. He also submitted to a Washington demand that he give the U.S. armed forces basing rights in PATAGONIA. The Pentagon evidently sees the base as strategic counter to a move by Russia, China or Iran to threaten America by striking through the soft underbelly of the Western Hemisphere. That is in violation of the Argentinian constitution. But, then again, isn’t that what indebted friends are for?

12.   In HONDURAS, the United States strong-armed the OAS not to penalize the government of President Juan Orlando Hernandez for its blatant rigging of the election last year

13.   In BOLIVIA, the U.S. has been conspiring with business interests and the oligarchical elite to overturn the government of reformist President Evo Morales. In the recent past, the American ambassador coordinated their efforts to topple Morales through orchestrated demonstrations in the mining and business hub of Santa Cruz.

14.   In PARAGUAY, Washington encouraged the oligarchical establishment to usurp the powers of the Presidency by impeaching the first progressive head of state in over 60 years. In 2008 the voters chose Fernando Lugo, a former Roman Catholic Bishop whose reformist policies were anathema to landed interests and big business. His governing as a Gospel Christian could not be tolerated. He therefore was duly impeached on absurd trumped-up by a simple majority vote of the Colorado Party opposition in the legislature. The elites' economic performance while in office since 1945 had as its greatest accomplishment the maintenance of the world’s only railroad still fueled by wood – evidently an attraction of some sort to the Obama administration in its promotion of a neo-Liberal economic order. 

15.   In VENEZUELA, the United States has used every weapon short of military force to overthrow the democratically elected government of President Nicolas Maduro

16.   In UKRAINE, the United States continues its military, financial, and political support for President Poroshenko whose was brought to power by an American orchestrated violent coup against his democratically elected predecessor

17.   In RUSSIA, the United States pursues a relentless campaign of slander against the democratically elected government of President Vladimir Putin and provides direct support via its embassy to opponents

18.   In LIBYA, the United States and its European allies have arbitrarily attempted to impose an ersatz government lodged on a yacht in Algiers harbor that has no popular support or legitimacy 

19.   In SYRIA, the United States has stationed troops against the will of the sovereign government in Damascus and provides material support to jihadist opponents (al-Qaeda & Assoc) fighting to overturn it.

20.   In IRAN, Trump leads a thinly concealed campaign to overthrow the current government

21.   In YEMEN, the United States has chosen sides in a civil war that involves participation in a homicidal air campaign carried out by Saudi Arabia and other outside parties

22.   In the PHILIPPINES, Trump personally has bolstered President Rodrigo Duterte in his program to build a lawless autocracy

23.   In SUB-SAHARAN AFRICA, the United States is actively involved in the internal politics of a dozen or so countries

24.   In LEBANON, The United States has been relentlessly engaged in a campaign to consolidate the power of its US-dependent government led by Rafik Hariri and to undercut Hezbullah and President Aoun

25.   In AFGHANISTAN…..

26.   In IRAQ…

25 -  INFINITY

Then, lest we forget, there are the sub rosa programs of the United States to strengthen democracy world-wide. One: the comprehensive surveillance of electronic communications globally. The product upon occasion makes its way into the hands of our favorites in the political game of other countries. Two: we regularly conduct drone strikes on persons WE determine are a menace to somebody else’s welfare and serenity, e.g. in Pakistan, Libya. By some stretch of the imagination, killings by HELLFIRE missile on their own soil, too, might be considered political interference. Three: more specifically, cyber attacks on sensitive computers and data banks, e.g. STUXNET in Iran

Pakistan’s placement in grey list by FATF is nothing but arm twisting

Reportedly Pakistan’s name has been added to the Financial Action Task Force (FATF) "Grey-list". The overwhelming reaction to this move is being termed "arm-twisting" to add to the woes of the country already suffering from serious balance of payment crisis. A point worth exploring is that there is no official FATF terminology segregating countries into grey or black lists, Pakistan has never been identified as a potential risk to the international financial system, even after 9/11 and often being accused of supporting the various militant groups.

I am being inclined to refer to a report by Pakistan’s leading brokerage house, AKD Securities. The brokerage house has taken a cues from the    2008-14 period (public identification/monitoring status), a termed the report a non-event in terms of crucial flashpoints on the macro-front, namely: 1) Foreign ownership of equities, 2) economic assistance, 3) workers’ remittances and 3) foreign exchange reserves. Reflective of the same, the benchmark index has recovered strongly in the recent past. Post clarity regarding the FATF decision (expected by Saturday 30th June). Investor’s risk-reward profile would soon align with more dominant economic (interest rate hikes, further devaluation prospects) and ongoing electioneering.

In the backdrop of the US foreign policy with narrowing space for Pakistan and post the first plenary meeting of FATF in Feb 2018, news reports started highlighting that FATF has decided to place Pakistan back on its watch list for AML/CFT weaknesses.  The perception in Pakistan is that such news reports have been more disparaging with a tinge of exaggeration (particularly in regional and local outlets) which are not only baseless and not rooted in published reports of international organizations of repute (OECD, WB, IMF and Basel Institute of Governance). However, parsing through all FATF publications CY18TD including documentation released by the FATF after its February 2018 meeting show that Pakistan is not mentioned at all, particularly in a negative light or deficient category. That said, Pakistan has not taken the threat of being included in the watch-list seriously as it has since then taking action against non-complaints, introduce various legislations, reforms and protocols to strengthen its AML/CFT framework.

One of the immediate response is that international standards are not created equal: On a broader note, comparing Pakistan's rankings on similar global international AML/CFT benchmarks by global agencies (Basel Institute, OECD), brokerage house finds domestic regulations (post 2015) stringent enough to counter long-term structural deficiencies (grey financial flows, hawala/hundi, low financial inclusion and sub-par lending practices). The Recent efforts by the GoP have been more proactive in market by Pakistan's inclusion in the OECD's Multilateral Convention on Mutual Administrative Assistance in Tax matters giving weight to GoP's measures (amnesty schemes, increasing declarations of foreign assets, raising the tax net).

Despite Pakistan’s placement in "Grey-list", foreign participation is largely expected to remain immune. Removing outliers (early 2009 period post market freeze), foreign ownership of equities gradually increased during the review period ranging between a little over 6% in 2008 to over 8% by end-2014. In absolute Pak Rupee /US$ terms, foreign ownership increased considerably during this period.

Economic Assistance is likely to continue keeping in view the past practices. Over the years, disbursements by bilateral/multilateral agencies have averaged US$1.3 billion to US$2.3 billion annually (excluding the 3-year SDR4.4bn/US$6.2bn IMF program approved in September 2013). Even though disbursements remained weak during the 2011-2013 period, it is unlikely that Pakistan's status under the FATF had a tangible bearing on economic assistance. That said, overall assistance (including capital mobilization through floating foreign bonds, commercial borrowing and the IMF) improved substantially during the 2008-2014 period.          .

Worker's Remittances continue to play an important role in containing current account deficit, despite ever increasing imports and paltry exports. Stringent KYC/AML/CFT protocols have certainly increased the cost of transactions, inward remittances increased substantially over the years, indicating that inclusion in the FATF grey list may not have a material impact on the cost of inward remittances.

Pakistan’s foreign exchange reserves increased to US$18.6 billion at the end of FY15 from US$11.3 billion in FY08. This also indicates that the Government of Pakistan (GoP) was able to keep an adequate level to support imports and other official outflows. Reserves also received a boost in FY13 after Pakistan signed a 3-year IMF program worth US$6.2 billion.   

Risk of Pakistan facing economic sanctions would include a reconsideration of all business relationships with Pakistan by global financial institutions and any attempt to put Pakistan along with North Korea and Iran is totally absurd. Additionally, parsing through global financial standard authorities rankings, Pakistan is given an AML index score of 6.64 (out of ten where lower is better) giving 4/46 rank in South Asia/Globally out of 6/146 countries by The Basel Institute for Governance. Moreover, recent efforts by the GoP have been more proactive in addressing these deficiencies where Pakistan's inclusion in the OECD's Multilateral Convention on Mutual Administrative Assistance in Tax matters (news reports indicate information sharing with tax authorities to commence from September'18) gives weight to GoP's "big-ticket".

Having a strong faith in the robustness of Pakistan’s financial system and the ongoing efforts to improve it the country’s placement in "Grey-list" is nothing but "arm-twisting". It is more than obvious that the US policies towards Afghanistan, Syria, Iran, China, EU countries and NAFTA members are aimed at establishing its hegemony around the world.

Pakistan Democracy on the Rough Terrain

On Friday, the last day of the week ended 6th July 2018, the accountability court announced its verdict imposing severe punishments and hefty fines on Nawaz Sharif (elected prime minister of Pakistan for the third time) and his family members. The decision is likely to severely impact general elections scheduled for 25th July 2018. There is a saying that history repeats itself. I am obliged to offer readers one of my articles written as back as April 2015. Its title was “Pakistan Democracy on the Rough Terrain”. To read details please click http://shkazmipk.com/democracy-in-pakistan/

Talk about re-imposition of sanctions on Iran an attempt to create storm in a teacup

Lately, the western media, controlled and run by Zionists, has been talking about re-imposition of economic sanctions on Iran, as 12^th May is approaching. The move has been initiated by the US president and many ‘me too’ are trying to please him. The crusade is led by Israeli prime minister, who is licking wounds caused to Israel in Lebanon by Hezbollah. The US is also adamant at taking revenge of its defeat in Syria, where it also faced Hezbollah. The west is never tired of accusing Hezbollah being supported by Iran but it is in no way part of Islamic Revolutionary Grads of Iran.   

The US commentators have very cunningly convinced OPEC led by Saudi Arabia to curtail crude oil output which has resulted in 1) substantial increase in crude oil price and 2) significant hike in the output by the US and Russia. At present, Saudi Arabia has slipped to third position in terms of daily oil output. The US has also emerged as one of the major exporter of crude oil. Therefore, Iran with a daily export of 2.6 million barrel has become ‘of no consequence’. Even if export of oil from Iran is stopped completely completely, it would be compensated by other producers very quickly.     

As a daily ritual, I have to write a few lines on commodities market and factors driving their prices. The most bizarre part is writing about the factors driving crude oil prices. The usual jargons used are increase/decrease in rig count in the US, movement in US stock piles, turmoil in Venezuela and MENA (countries including Iraq, Libya, Nigeria). Little reference is made to investment by hedge funds.  

I still remember once taking part in a live panel discussion on factors driving crude oil prices (more than ten years ago) I had said, “The price of crude oil may be driven by any factor, but certainly not by demand and supply”.  I could see the signs of disgust on the face of moderator. After the show was over he even went to the extent of saying, “Mr. Kazmi, today you said something which sounded totally absurd and I could have responded. However, I kept quiet and gave you benefit of doubt.”

Moral of the story is developed economies, through hedge funds make millions of dollars through movement in crude oil prices. To achieve their target they often breach agreements. Super powers are notorious for breaching the agreements to achieve their ulterior motives. Therefore, re-imposition of sanction on Iran will not be a surprise but an example of yet another blatant violation. However, they must not forget that even stopping oil export from Iran completely will neither make an immediate difference for Iran nor sky rocket the oil prices.

Making Pakistan hub of Islamic Finance by 2025

On the inaugural day of conference Dr. Miftah Ismail Adviser to the Prime Minister on Finance and Economic Affairs said the Ministry of Finance would soon set up a separate division for the promotion of Islamic banking in Pakistan. He was the Chief Guest at a two-day World Islamic Finance Forum (WIFF-2018). The international forum was organized by Institute of Business Administration’s Centre for Excellence in Islamic Finance IBA-CIEF in collaboration with key partners. The theme was “Expanding the Footprint of Islamic Finance: Innovation, Fintech and Regulations.”

In his visionary note, Shaikh Muhammad Taqi Usmani Chairman, Shariah Board of Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) said the people of Pakistan origin were holding key positions in Islamic banking industry around the world, making contribution in developing regulatory framework and above all developing products that would meet the emerging needs of trade and industry. He urged the government to take concrete steps for making the economy Riba (interest) free. He also pointed out that Islamic financial institutions have ample liquidity and the government should work for creating new avenues for its deployment in remunerative options. He suggested that the ruling party should also include in its election manifesto that Riba would be eradicated totally from economy at the earliest.

Chairman AAOIFI Board of Trustees, Bahrain Shaikh Ebrahim Bin Khalifa Al Khalifa said it was heartening to note that Pakistan was striving to become another hub of Islamic finance. The country has all the basic ingredients — a population of 200 million predominantly Muslims, a robust banking and finance sector, vibrant agriculture, industrial and services sectors.

On the occasion were present the top officials of the apex regulators – State Bank of Pakistan (SBP) and Securities & Exchange Commission of Pakistan, Deputy Governors of the central bank, Jameel Ahmad and Shamsul Hasan talked about the central bank’s initiatives for the to promote Islamic banking in the country. The progress made over the last decade has been encouraging that has facilitated in achieving the target. They were also of the view that making Pakistan hub of Islamic finance would not be difficult.

Irfan Siddiqui, President Meezan Bank requested the federal government to set a target to acquire at least 25 per cent of the local funding through Islamic banking as Islamic financial institutions have ample liquidity and limited avenues for investment.

In his key note address, Dr. Ishrat Husain, Chairman, IBA-CIEF talked about the progress made by Islamic banking in Pakistan. He was of the view that the progress made during last one decade was enormous but new products need to be introduced to provide fresh impetus for growth.

IBA-CEIF Director, Ahmed Ali Siddiqui, welcoming the delegates, said the Centre had emerged as a regional platform for excellence in Islamic finance. He said focus areas of CEIF included development of Islamic finance professionals and new human resources talent pool through industry linkages and international collaborations.

Two of the closed-door meetings deserve special mention, though details discussed were not made public. In the first session players and regulators discussed details that could help in making capital market and mutual funds Shariah compliant. The issue of financial inclusion and outreach were the two important themes to be discussed at length. The second session was between Sharaih scholars and regulators for evolving regulatory frame work that can help in developing products to meet the needs of different income strata and those having different risk appetite.

Yet another initiative was presentation of research papers discussing contemporary issues. One of the sessions deserves a specific mention where lending to farmers was discussed. At present bulk of the loans are extended to farmers against passbook or the landownership document. This process mostly benefits the feudal lords. In this discussion the issue of warehouse receipt financing was also debated. However, it was evident that unless modern warehouses and collateral management companies are established warehouse receipt financing may not be possible. Authors of selected papers were awarded cash prizes.

The takeaways of the concluding remarks of Dr. Ishrat Husain were: 1) creation of Shariah Board at Ministry of Finance, 2) borrowing for infrastructure development projects through flotation of Rupee and Dollar denominated Sukuks, 3) focus on the development of Fintechs for extending outreach of banks and ensure financial inclusion and 4) development of alternative delivery channels.