Ishrat's reforms yet to be implemented

ISLAMABAD: December 1999, Pakistan had been left with only $300 million in foreign exchange reserves due to crippling economic sanctions and international isolation and at that time military ruler General Pervez Musharraf appointed Dr Ishrat Husain to turn around the central bank. Six years later, when he left, the country had $13 billion in foreign exchange reserves, also built by purchasing dollars, and people's trust in banks and in the economy had been restored. The $300 million reserves that Pakistan had in December 1999 were also the result of a $500 million Chinese loan. After leaving the central bank following two maximum stints, Husain did not rest and contributed to improving economic governance and civil service reforms. November 2026, in the words of SBP Governor Jameel Ahmad, "Pakistan's economic situation remains challenging". While praising the innumerable achievements of Husain, Finance Minister Muhammad Aurangzeb said that, as chairman of the Cabinet Committee on State-Owned Enterprises (SOEs), he took inspiration from Husain's reports. "I have to admit that I took his report as a starting point, but we still have a long way to go, and some of the folks are not happy with that," said Aurangzeb while eulogising the role of the former central bank governor and former adviser to the PM on institutional reforms. The Sustainable Development Policy Institute (SDPI) on Tuesday awarded Husain the Lifetime Achievement Award in recognition of his public services that began in 1964 as Pakistan's civil servant. He remained the SBP governor from 1999 to the end of 2005, head of many government committees, adviser to the PM and also served in the World Bank. However, three events – the 1999 economic crisis, the turnaround by 2005 and the persistence of same economic challenges today – underscore that Pakistan produced many great personalities, including Dr Ishrat Husain, but the country remains in the same quagmire with brief intervals of a booming economy. As part of the World Bank management, Husain advised three countries: Ghana, Tajikistan and Azerbaijan. Ghana was the first country that embraced the World Bank's structural reforms, and it is today a success story, Husain said. However, Pakistan has taken an unlimited number of World Bank structural reform loans and 25 IMF programmes, but it is still struggling to implement basic reforms that could put the country on a sustainable development path. Husain said that he helped Tajikistan as the World Bank country director to raise funds for development, which the Tajik leadership still acknowledges, and he was really proud of it. He said that he advised Azerbaijan to set up a sovereign wealth fund to save the windfall gains from gas sales, and today the state-run sovereign fund had $75 billion of assets. However, Pakistan established a sovereign wealth fund in 2023 but it had not been able to make the fund operational amid IMF concerns. "Husain is an institution in himself who turned around the central bank and many other institutions," said Sultan Ali Alana, Chairman Habib Bank Limited. "The SBP is the best regulator of Pakistan, which was only possible because of the transformational role played by Husain," remarked Finance Minister Aurangzeb. "Husain is an expert in economy, education, trade and governance reform, and he was Google for us when Google was not that popular in Pakistan," said Dr Abid Qaiyum Suleri, the head of SDPI. "Retirement is not in the DNA of Dr Ishrat Husain," Aurangzeb said, adding that after leaving the SBP, Husain put a lot of good and hard work into governance reform reports. "Everyone who comes here in SBP is always in a great hurry, and he will too reconcile with ground realities," were the first remarks by the then deputy governor when he received the news of Husain's appointment in December 1999, revealed incumbent Governor Jameel Ahmad. He said that within six years, Husain transformed the central bank and introduced many reforms. "Institutional builders must be such that the institution remains the same after they leave," said Ishrat Husain. In his message to the youth, he said "your beginning need not to determine your destination" while sharing his journey from a shy and underdeveloped boy to a towering figure who made his mark in every field where he performed. Former secretary to the prime minister Nargis Sethi recalled working closely with him during his tenure as chairman of the National Commission for Government Reform, established by the government in 2006. Dean Emeritus and Professor at Boston University's Pardee School of Global Studies, Dr Adil Najam, said this aspect of his legacy was often underestimated because attention largely remained focused on his achievements as a policymaker.