Prime Minister Shehbaz Sharif has put a halt to the proposal to allow dual nationals to take up key positions at the State Bank of Pakistan (SBP), including roles such as governor, deputy governors, and members of the monetary policy committee. This decision comes after a cabinet committee had unanimously recommended the change.
Last week, the federal cabinet once again postponed the approval of the State Bank of Pakistan Amendment Bill 2024, following the Prime Minister’s request. The bill aimed to amend the SBP Act to allow dual nationals to hold important positions within the central bank, as well as legalize the use of cryptocurrencies.
A committee led by Planning Minister Ahsan Iqbal, including ministers from Defence, Law, and Finance, had initially reviewed the proposal. The committee recommended removing a key clause from the SBP Act, which disqualifies dual nationals from becoming governor, deputy governors, directors, or members of the SBP.
Section 13A of the SBP Act, introduced in 2022, currently bars anyone with dual nationality from holding these positions. However, Prime Minister Sharif has opposed this proposed change, deferring the matter once again at the finance ministry’s request.
The restriction on dual nationals was initially enacted as part of broad amendments to the SBP Act under pressure from the International Monetary Fund (IMF) and in line with the previous governor’s preferences, though the IMF did not specifically call for the dual nationality restriction.
Despite this, some ministers within the cabinet have raised concerns about allowing dual nationals into key SBP roles, arguing that they may return to their home countries after their tenure. Finance Minister Muhammad Aurangzeb, who renounced his Dutch nationality upon becoming finance minister, has voiced support for the amendment, suggesting that dual nationals bring valuable expertise to the central bank.
One prominent example is Dr. Inayat Husain, a former deputy governor of the SBP who holds dual nationality. The government had hoped to reappoint him for a new five-year term, but the current law may prevent that. If the Prime Minister maintains his stance, the SBP may need to let go of Dr. Husain.
The debate over dual nationality in sensitive government positions continues, with discussions extending to the possibility of similar restrictions being applied to other government sectors. The committee led by Ahsan Iqbal is tasked with reviewing the proposed changes and making recommendations to the federal cabinet.
