Financial integration

Economists have emphasised the importance of the financial system in fuelling economic growth. In today’s era, financial integration is one of the main sources for generating funds through government securities. Macroeconomic stability is an important factor for the growth and development of financial markets in any economy. However, Pakistan has lacked this stability since the outset. In June 2006, the Securities and Exchange Commission of Pakistan set up the Debt Capital Market Committee (DCMC) to identify the fundamental challenges that were hindering the growth of the financial market. The DCMC asserted that the National Savings Scheme (NSS) was the major hurdle to reforming debt and capital markets. As per the committee’s findings, NSS schemes are a consistent source of long-term finance to the government. Be that as it may, we cannot forget that these schemes have been an expensive source of funding due to inefficient pricing policies and premature encashment. These are among the many challenges that have inhibited the growth of financial markets in Pakistan. If the finance ministry starts focusing on these issues, Pakistan can generate funds through financial integration. Financial markets can pulls the country out of the economic quagmire that it finds itself in.Sarbaz PalijoHyderabad

from The News International - Newspost https://ift.tt/2qjQFql