Pakistan’s Minister for Finance Muhammad Ishaq Dar held a meeting with officials from Dubai Islamic Bank (DIB) in Dubai where they discussed prospects of another sukuk issuance and hiring an advisor for transparent sukuk transaction.
Following the success of Euro Bond wherein Pakistan raised $2 billion from capital market recently, the minister said government intends to tap the sukuk market to increase its foreign exchange reserves. The $2bn bond saw strong response and was oversubscribed with total bids amounting to $7 billion.
Dar told Bloomberg in an interview that Pakistan plans to sell $1 billion dollar-denominated sukuk which will be marketed at the end of the third or in the fourth quarter of 2014.
Dar said Pakistan government would soon release an advertisement in international and local press to hire financial advisor for sukuk transaction through a transparent and competitive process.
DIB Chief Executive Officer Adnan Chilwan and Pakistan minister discussed details about the sukuk market and the attractive prospects of investments through this Islamic finance instrument. Chilwan said there is an appetite in the market for issuance of sukuk and the Pakistan government should access the market regularly.
The role of financial institutions such as DIB will significantly increase in coming years as Dubai aims to become global financial centre of Islamic finance.
Ishaq Dar also chaired a meeting with IMF delegates, which was attended by the senior officials of Ministry of Finance and State Bank of Pakistan to give an update on Pakistan’s economy.
Pakistan’s economic performance, the minister said, was on track and most of the policy actions, performance criteria and benchmarks have been met.
The growth during the first half of current financial year was 4.1% compared to 3.4% of H1 in the previous year.
The factor behind the growth is the rebound in industrial sector, which is backed by remarkable growth in large scale manufacturing sector due to better energy supply.
All indicators of the economy are on upward trajectory. The inflation has also been contained to single digit during the first ten months of the current fiscal year, Dar said.