KARACHI – Chairman of National Business Group Pakistan, President Pakistan Businessmen and Intellectuals Forum, and All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain on Wednesday said the business community want an independent central bank so that it can serve beyond political priorities and play its role to strengthen economy and control inflation.
However, complete immunity to all the officials of the State Bank of Pakistan is not in the national interest.
Mian Zahid Hussain said that SBP officials should be shielded from NAB and FIA but it should remain answerable to the Parliament.
Talking to the business community, the veteran business leader said that SBR should not be made completely independent and above any kind of accountability.
He said that it will create problems if any institution including Parliament would not be able to demand a clarification for the action of the central bankers.
Such a move will be tantamount to making another institution a state within a state, he said adding that the decision to make SBP fully independent should be revisited.
He said that the IMF was pressuring the government to give the central bank full autonomy through legislation to free it from political interference, which would give incredible powers to the bank’s governor.
It will be necessary to amend the SBP Act, while the government will also face resistance from the opposition which is not favouring such decisions, he added.
The governor will be able to focus on his job instead of worrying about undue support of government policies and unwanted steps to achieve government goals, he said.
Mian Zahid Hussain noted that many economists are calling the move against the country’s interests.
He said that by empowering the SBP, setting interest rates and exchange rates would be out of the control of the government and the bank would be able to take independent decisions to strengthen the financial and economic system of the country.
The pressure to implement the political agenda of rulers will be removed, but it will lead to excessive concentration of power in the person of the governor and so much centralization will not be in anyone’s interest.
It is important to keep central bank officials out of the reach of the NAB or the FIA, but not from Parliament’s oversight.
