During a luncheon meeting the other day with the Executive Committee of Small and Medium Enterprises Association (SAMEA), headed by it's president Zafar Iqbal and a selected group of small and medium-level exporters, State Bank Governor Dr Ishrat Hussain clarified some features of the newly-launched scheme for supporting capacity development in SMEs sector and import/purchase of machinery for the existing and newly established industries.
Responding to a question about prudential regulation, the governor said that legal advisory committees have been constituted; at 16 places with clusters of SMEs; chaired by the chief manager of the State Bank to deal with specific problems being faxed vis-à-vis lending banks, etc.
On a suggestion that dollar parity rate may be brought up to Rs 60 for a dollar, to help exporters and encourage foreign investment, he disagreed saying that it would be counter-productive and directed towards favouring some, at the cost of importers.
On recommendation to activate Islamic banking in big commercial banks, still having considerable government ownership, Dr Ishrat Hussain said, "it is the matter of preparedness of any individual bank and is not the question of size and ownership. If other private banks are more actively adopting Islamic form of banking, SMEs are free to deal with them."
Responding to another question about various rules and regulations with particular reference to labour laws, Dr Ishrat mentioned that in Punjab they have had already started joint inspection and visit to places of business, especially for SMEs, only once by different agencies and hoped that similar practice would be introduced in other provinces.
Addressing the issue of circulation of dirty notes, he stressed the need to educate general public to avoid misuse of paper currency, which is costing the government over Rs 2 billion every year for replenishing dirty notes.-PR