Renowned economist Atif Mian has praised government’s step towards digitalisation and recent policy actions of State Bank of Pakistan (SBP).
Atif Mian took to Twitter to appreciate the SBP’s move of making exchange rate market-based.
While talking about government’s policies of digitalisation, he tweeted, “steps taken towards digitization and greater transparency of the financial sector are welcome changes. The initial success from stabilization has brought new challenges though in the form of ‘hot money’ portfolio flows.”
“SBP under new leadership held the fort through the painful adjustment period. This deserves praise,” he said.
He further said, “I was critical of the government move to cut taxes to encourage foreign flows into government debt. However, these cuts were on longer-dated bonds, and flows into TBills had started before the change. Tax incentives and ease of convertibility should be targeted towards FDI, and away from portfolio flows at this stage of financial and economic development for Pakistan. This is the broader lesson from history in my view.”