Who Owns Pakistan - Yimg

nationalization of banks, on the grounds that it would turn out to be "
administrative nightmare" and instead pleaded for remedy of the situation by
strict central bank regulations. It was argued by him that fiscal, monetary and
other policies directed the flow of bank credit into few hands and therefore these
policies or their lack, and not the banks were to be blamed for concentration of
wealth.
However banks were nationalized and ruthlessly plundered. The plunder started
as a trickle durig Z A Bhutto era, quickened as a brook under Zia ul Haq but
became a waterfall of corruption under which both Benazir and Nawaz Sharif
took turns to shower.
It is 23 years since the fateful new-year day when Bhutto announced the
nationalization of banks to meet the socio-economic objectives of an egalitarian
society. Did it change in any way the lending pattern or the financial landscape,
as far as the common man's credit requirements were concerned.
Who Gets the Bank Loans
In 1964, Pakistani banks made out 0.57 million loans to the tune of Rs 5.5 billion.
Of these, loans up to Rs 40,000 accounted for 98% of the number of loans but
18.9% of the total advances. The loans of Rs 1 million and above claimed 50% of
total advances. Only 40% advances of Rs 10 million and above were made but
they claimed 21% share of the entire credit created by the banks.
According to State Bank annual report, total advances made by the bank in 1990
were estimated at Rs 230 billion, advances up to Rs 40,000 had 10% of the
share, loans of Rs one million and above had 72% share while only 1200
persons received loans of Rs 10 million and above, with a 48% stake of the
entire cake, by receiving Rs 110 billion in loan.
It is evident from the above figures tha monopoly on credit deteriorated in the 20
years of post nationalization. Ironically this deterioration continues, despite the
candle-lit dinner speeches by the Governor State Bank of Pakistan, Dr
Mohammad Yaqub in 5-star hotel of Karachi and Lahore about the credit needs
of " the small men, small business and small cities".
But who are the 1,200 people who borrow loans of Rs 10 million and more, or Rs
120 billion per annum from the entire banking system and for what purpose these
loans were used? It is not difficult to attempt the answer, thanks largely to the
tales of corruption told from political rooftops during last ten years and the lists of
defaulters published in 1993 and 1996.
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