Aurangzeb says Pakistan economy’s issues have been addressed

KARACHI: Minister for Finance and Revenue Muhammad Aurangzeb said on Thursday that Pakistan’s economy is moving towards sustainable economic growth, and hinted at mobilising critical financing for infrastructure development and poverty alleviation through Shariah-compliment bonds like Sukuks.

In his online address at the second International Islamic Capital Markets Conference & Expo in Karachi, Aurangzeb said Pakistan has faced economic challenges in recent years.

However, issues have now been addressed and “now we are on the right trajectory towards macroeconomic stability and going forward moving towards sustainable growth”.

Now revenue leakages come under govt focus

He said Islamic instruments like Sukuks and Shariah-compliant investment vehicles “are vital to mobilise financing to critical sectors like infrastructure development and poverty alleviation through Islamic financing”.

“With the mechanism in place, Pakistan has the potential to emerge as a leading global hub for Islamic finance.”

Aurangzeb said the government remains committed to transforming the financial system in line with Shariah principles.

Pakistan is not only committed to raising new investment through Islamic products but also determined “to reduce reliance on interest rate borrowing.”

He said 56% market capitalisation at the Pakistan Stock Exchange (PSX) comprises of Shariah-compliant securities. In the investment segment, 48% assets under management of mutual funds are Shariah-compliant. 66% funds under management of voluntary pension funds and 95% assets in REITs (real estate investment trust) are Shariah-compliant.

Remittances to hit $35bn in FY25: Finance Minister

He said the conference underscores Pakistan commitment in fostering a robust Islamic capital markets and highlights country’s dedication to transforming economic system in line with Shariah principles.

State Bank of Pakistan, Deputy Governor, Saleem Ullah said transforming Pakistan’s huge debt into Shariah-compliant products remained a huge challenge for the authorities concerned.