Pakistan, India allow two banks each to operate across border
“We have held discussions with the Reserve Bank of India and both sides have agreed to issue a full banking licence to two banks of each country,” Anwar told the Press Trust of India on the sidelines of a conference organised by the Institute of South Asian Studies in Singapore.
The two Indian banks that will be allowed to operate in Pakistan are State Bank of India (SBI) and Bank of India (BoI). On the other hand, state-owned National Bank of Pakistan and privately-owned United Bank Limited will be running full-banking operations across the border, once licensed by India.
Last month, MCB Bank Chairman Mian Mohammad Mansha also expressed interest in opening bank branches in India and announced that the bank had filed an application with the central bank in this regard. However, it has apparently not been given the go-ahead so far.
“It will take a few months to approve Indian banks’ licences on receiving them,” Anwar said, adding “we are ready to go tomorrow to India” to set up banking operations.
This development is part of efforts made by the two countries over the past many months to step up trade and economic relations. In a major decision earlier this month, India allowed investment from Pakistan paving the way for Islamabad to normalise economic ties by implementing much-delayed Most Favoured Nation (MFN) status for New Delhi.
Earlier this year, Pakistan switched to a negative list for trade with India, which may eventually lead to granting the MFN status to Delhi.
Trade between India and Pakistan is worth more than $2 billion and the two sides have agreed to increase it to $6 billion by 2014.
Published in The Express Tribune, August 23rd, 2012.
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how much time left to running banks.....
@Bhrat Bhusan: It is BOI(Bank of India) not IOB (Indian Overseas Bank) that has got permission to do business in Pakistan, what is the great hurry to post messages first get your facts correct.
Well done, at last some good news, this is so much better, these are substantial steps, forget cricket, it's just a game and we have both played around with our people long enough. It is time to grow up and play grown up games. ---go Pakistan---go India.
@Asim: to Bharat Bhushan "We have seen enough bickering between the two nations… and if a change is made to make relations better, it would be wise to appreciate it." So, how is the investigation of 12/26 going in Pakistan? India cannot be made solely responsible for making the relations better. Pakistan has to do its part. We cannot forget. We do not forget. We will not forget!
next thing pride parade in Lahore
Winds of change blowing...though slowly...!! Lets hope for the best
Indian Govt. took its first step to improve Pakistan's Economy! If Pakistan responds good for this, then Indian Govt. will take further steps to help Pakistan's Economy further more!
India and China are not friends but there is a lot of trade which ensures that there is a strong lobby for peace today and maybe friendship one day . That is the way forward for us , trade creates business opportunities which creates jobs and revenue for both govts thereby creating a lobby for peace which will keep the hot heads on both sides in check.
This is a great achievement by both countries to come close each other.Pakistani Nation fully support this agreement.This will help to minimise the wastage of time reduce cost of Goods at the time of import and export to each other.
@Bhrat Bhushan, SBI and BOI will do business in Pakistan. I'm sure you understand what business means. Please no need for us to be cynical all times. It's a good initiative and if they help bring peace in our countries and promote friendship, we should fully welcome them.
It's a very good initiative indeed. This will help bring our people closer to each other and strengthen our friendship. Love India and Pakistan :-)
I wonder what SBI and IOB will do there ? Count flies...
bring in paypal for us. I am ready to open my account in indian bank :).
Our two countries need normalisation of relations, settlement of disputes and real cooperation in cultural life. There has developed extremism on either side, in parallel with nepotism, corruption, population growth, and poverty. Both countries have fallen behind in literature and art, due to the rejection of the English language and no alternative medium of expression in the public life, as demanded by exigency. Our two nations must return to living as brotherly societies.
We need Riba-free banking in Pakistan and other countries.
This is interesting but if would be good to understand how the common citizen of Pakistan would benefit from this. This may benefit some businessmen in arranging for transferring money for export import but a commercial banking setup is good enough or that. I would also like to understand the criteria for selecting UBL. Please do a follow up story on both questions.