Banking Support Key to Pakistan’s Industrial Growth
ISLAMABAD:
On Wednesday, Special Assistant to the Prime Minister on Industries and Production, Haroon Akhtar Khan, met with Rehmat Ali Hasni, President of the National Bank of Pakistan (NBP). The two leaders discussed new strategies to boost industrial growth in Pakistan.
They focused on industrial loans, investment promotion, and collaboration between banks and industries. This alignment is central to the government’s vision of sustainable industrial growth.
Key Takeaways from the Meeting
- Haroon Akhtar highlighted that expanding access to credit is critical.
- He praised NBP for its role in providing industrial financing.
- The SAPM said the banking sector’s role is essential for overall economic activity.
- Rehmat Ali Hasni assured full support from NBP to support the vision of industrial development
The outcome is expected to strengthen public-private coordination for industrial expansion in sectors like textiles, manufacturing, and agro-processing.
Why Industrial Growth Matters Now
Pakistan’s industrial sector now contributes just 18% of GDP, down from 26% in 1996. This decline is a key concern. Reviving the sector requires stable financing, regulatory reform, and investment incentives.
Haroon Akhtar Khan has consistently emphasized that industrial growth hinges on modernizing industries and boosting export potential.
The government recently adopted a 10-year industrial policy, which includes:
- Access to long-term loans with grace periods
- Tax reforms for industry
- Support for sick industries and SMEs
These reforms aim to reverse industrial decline and improve competitiveness.
NBP’s Role in Industrial Financing
NBP, as a state-owned bank, plays a pivotal role in offering credit to industry. The meeting highlighted potential areas of collaboration:
- Redesigning industrial loan products for long-term investment
- Offering operational credit to small and medium enterprises (SMEs)
- Financing export-oriented projects and import substitution ventures
- Supporting technology upgradation through affordable loans
The synergy between NBP’s lending and government policy aims to accelerate industrial growth across key sectors.
Strategic Financial Support Measures
The officials discussed broader financial strategies:
- Debt restructuring for distressed industrial units
- Offering working capital tied to new machinery and automation
- Introducing favourable interest rates aligned with macroeconomic stability
- Providing data-driven risk assessment tools for early detection of industrial stress
The overarching aim is to ensure that financial institutions actively support industrial revival without compromising fiscal discipline.
Broader Policy Context for Industrial Growth
Haroon Akhtar Khan has unveiled a comprehensive National Industrial Policy. Key elements include:
- Incentives for domestic production
- Reducing corporate tax from 29% to 26%
- Simplifying business regulations
- Enhancing investment security
- Promoting renewable energy manufacturing, pharmaceuticals, IT hardware and chemicals
He has set up ten sub-committees to fast-track reforms. The goal is a coordinated industrial boom and robust export-led growth.NBP’s participation in executing credit frameworks for these reforms is seen as vital to sustainable industrial growth,“Read: SAPM’s industrial growth funding meeting with NBP president”
What Industry Stakeholders Want
Industrialists and sector leaders have been clear:
- They demand consistent policy and regulatory clarity.
- They support reduced tariffs, better financing, and bureaucratic ease.
- They advocate for alignment of financial support with export promotion and localisation.
Haroon Akhtar has repeatedly engaged with business councils and chambers to ensure industrial growth remains central to economic reform plans.
Challenges and Success Metrics
Challenges include credit bottlenecks, high taxation, power costs, and infrastructure gaps. SAPM and NBP aim to mitigate these pressures through coordinated financial and industrial policy.
- Annual industrial loan growth is expected to rise
- Manufacturing output and export volumes should increase
- Revival of sick and closed factories will be tracked
- Industrial employment numbers are a key indicator of success
Collective performance will demonstrate the real impact on industrial growth.
Conclusion: Finance Meets Industry for Growth
This meeting marks a critical alignment of government policy and banking support. As Pakistan seeks to revive its industrial base, the combination of strategic financing and proactive policy can create a robust environment for industrial growth.
If financial institutions back industrial initiatives with strong investment tools, and regulatory reforms stay on course, Pakistan’s manufacturing sector may well embark on a recovery path. The NBP’s backing brings momentum to this vision, and the joint effort with SAPM Haroon Akhtar could lay the foundation for a revived, export-driven industrial economy. Click here for latest news.
