HBL set to start op­er­a­tions in China this year Soft launch of the project to be held on 14th Au­gust in Beijing

Pakistan Observer - - ECONOMY WATCH -

Cur­rency Sell­ing Buy­ing

MIAN AR­SHAD ISLAMABAD—In a ma­jor break-through in the ex­port of bank­ing ser­vices to China, first Pak­istani Bank will open its branch in China this year in the West­ern Chi­nese city of Urumqi; cap­i­tal of Mus­lim dom­i­nated Xin­jiang Au­tonomous Re­gion. Habib Bank Lim­ited (HBL) will be the first South Asian bank to start op­er­a­tions in the West­ern Chi­nese part and the soft launch of the project will be held on 14th Au­gust in Beijing this year. Ac­cord­ing to Pres­i­dent of HBL Sul­tan Ali Il­lana and CEO, HBL Nouman Dar, Bank plans to en­hance its pres­ence all along the CPEC in China and Pak­istan and fur­ther into the fi­nan­cial hubs of China.

In this re­gard, China granted a num­ber of con­ces­sions to Pak­istan on bank­ing sec­tor in­clud­ing as­set re­quire­ment for es­tab­lish­ing a bank branch has been re­duced to $15 bil­lion from $ 20 bil­lion for all Pak­istani banks, at the end of the year prior to the sub­mis­sion of ap­pli­ca­tion. The Pak­istani banks can also open their busi­nesses in RMB (Chi­nese cur­rency) af­ter one year of their busi­ness in China which was pre­vi­ously three year and busi­ness could only be done in dol­lars. The con­di­tion for be­ing prof­itable for two con­sec­u­tive years prior to the sub­mis­sion of ap­pli­ca­tion has also been re­moved.

In re­sponse to a ques­tion, the Min­is­ter said that Pak­istan has not granted any spe­cial con­ces­sions to Chi­nese Bank­ing sec­tor as Pak­istani bank­ing reg­u­la­tions are lib­eral but as­sured them of fast track­ing their ap­pli­ca­tions. Presently, the in­ward re­mit­tance /LC are routed through for­eign banks. Once the Pak­istani banks are opened in China, the fi­nan­cial trans­ac­tion would be routed through our own banks. It is ex­pected that a sub­stan­tial amount of money would move through our banks, which would ben­e­fit not only to the re­serves of the coun­try but help in the ex­pan­sion of econ­omy.

This new open­ing in the fi­nan­cial sec­tor of China prom­ises growth and ex­pan­sion op­por­tu­ni­ties for Pak­istani banks es­pe­cially in the wake of Pak­istan China joint ini­tia­tives for de­vel­op­ment. The Chi­nese in­vest­ment for eco­nomic cor­ri­dor will be chan­nel­ized through the Pak­istani banks. It is ex­pected that the cur­rent ac­count deficit is ex­pected to be lower through this ini­tia­tive. In this con­nec­tion, Pres­i­dent of HBL Sul­tan Ali Il­lana and CEO, HBL Nouman Dar, Mon­day, held a meet­ing with Min­is­ter for Com­merce, Engr. Khur­ram Dast­gir Khan here. Later talk­ing to the me­dia Min­is­ter said that the es­tab­lish­ment of a bank­ing chan­nel in China would greatly fa­cil­i­tate the flow of cap­i­tal for the mega projects that the Govern­ment is un­der­tak­ing with the Chi­nese sup­port.

He high­lighted that the Min­istry of Com­merce has ne­go­ti­ated with China to re­lax the strin­gent re­quire­ments to for the en­try of for­eign banks into the Chi­nese mar­ket. The Min­is­ter men­tioned that the as a re­sult of suc­cess­ful trade diplo­macy of the MoC, the min­i­mum as­set re­quire­ment for a Pak­istani bank was re­duced by $5 bil­lion which re­sulted in a Pak­istani bank qual­i­fy­ing for en­try into Chi­nese mar­ket. This is a landmark event which will pave way for other Pak­istani banks to fol­low suit and fully uti­lize the con­ces­sions of­fered by the Chi­nese side, the Min­is­ter hoped. Dast­gir stated that the open­ing of Pak­istani Banks in China is the first step in the larger plan of fi­nan­cial and cap­i­tal con­nec­tiv­ity with the Cen­tral Asian States where Pak­istan is vig­or­ously pur­su­ing road, trade and tran­sit con­nec­tiv­ity.

ISLAMABAD: Fed­eral Min­is­ter for Com­merce Engr Khur­ram Dast­gir Khan ad­dress­ing me­dia along with Pres­i­dent of Habib Bank Lim­ited Sul­tan Ali Il­lana and CEO of HBL Nau­man Dar.

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