Dec. 3 (Bloomberg) -- Shamshad Akhtar, an Asian Development Bank official, was named the first woman to run Pakistan's central bank.

President Pervez Musharraf appointed Akhtar to a three-year term as governor of the Karachi-based State Bank of Pakistan, central spokesman Syed Wasimuddin said today. Akhtar is currently director general of the Southeast Asia department at the ADB. She joined the multilateral lender in 1990 and previously had been a World Bank economist in Islamabad.

Akhtar has an M.S. in economics from Quaid-e-Azam University in Islamabad, an M.A. in development economics from England's University of Sussex and a Ph.D. in economics from Scotland's Paisley College of Technology. She studied at Harvard University in 1987 under the Fulbright program.

Akhtar will guide monetary policy for a nation in which one third of the 160 million people live on less than $1 a day and which must rebuild after an Oct. 8 earthquake in the Himalayan region of Kashmir killed more than 73,000. The government forecasts the $100 billion economy will expand 7 percent in the year to June 30, 2006, and consumer prices will rise 8 percent.

``The new governor has challenges to face on improving the foreign-currency reserves, checking inflation and giving the corporate sector easy access to funds,'' said Arif Habib, who manages the equivalent of $250 million as chairman of Arif Habib Investments Ltd. in Karachi. The financial sector had ``tremendous growth'' during the tenure of Ishrat Husain, who retired as the central bank's chief on Dec. 1, he said.

Policies

In an interview Nov. 23, Husain, 64, predicted his successor would keep a tight monetary policy to help curb inflation. He cited reforming Pakistan's financial sector, increasing reserves to $11.5 billion from less than $1 billion and a stable exchange rate as his most important achievements.

The State Bank raised its discount lending rate by 1.5 percentage point to 9.0 percent on April 11.

Standard & Poor's rates Pakistan B+, four levels below investment grade. The ratings company lowered the country's sovereign debt rating to within two levels of default status in October 1998.

``Markets will expect the non-political appointee to demonstrate visible inflation-fighting prowess and increased autonomy'' said Muhammad Imran, a research analyst at Jahangir Siddiqui Capital Markets Ltd. in Karachi. ``It remains to be seen whether it will be the hawks or the doves who gain control of the skies.''

Among those who had been under consideration to succeed Husain were Nawid Ahsan, secretary at the finance ministry, Ashfaque Hassan Khan, head of the debt-management department at the ministry, and Javed Hamid of the World Bank's International Finance Corp., the Dawn newspaper reported on Oct. 10.

Akhtar will be the 14th governor of the central bank since its foundation in 1948.

Pakistan already has had a female prime minister. Benazir Bhutto led the nation from 1988 to 1990 and from 1993 to 1996.

To contact the reporter on this story: Haris Zamir in Karachi at hzamir@bloomberg.net; Khalid Qayum in Islamabad at kqayum@bloomberg.net

Last Updated: December 3, 2005 13:59 EST