Dar Appointed Pakistan’s Finance Minister as Growth Falters

Pakistan’s Prime Minister Nawaz Sharif appointed 25 ministers to his cabinet, giving the key finance and energy portfolios to close aides as the new government faces a sluggish economy and entrenched energy shortages.

President Asif Ali Zardari administered the oath to 16 federal and nine junior ministers at the presidential house in Islamabad yesterday, with two ministers from Sharif’s smaller coalition partners. Mohammad Ishaq Dar was named Finance Minister and Khawaja Muhammad Asif will oversee the Water and Power ministry, according to a government notification issued late yesterday.

Sharif, 63, took office on June 5 as the nation struggles to arrest its economic slump. He returned to power more than 13 years after his second period as premier was cut short by a 1999 army coup. Having won almost half of the seats contested in a May 11 general election, his Pakistan Muslim League-N party can govern without a major coalition partner.

The new administration will need to bridge a budget gap that’s at the highest in almost two decades and spur economic growth from an annual average of 3 percent as energy shortages shut the grid for as much as 18 hours a day. Nationwide attacks by Taliban insurgents have killed 40,000 people since Pakistan decided to support the U.S. war in Afghanistan after the September 11, 2001 attacks.

Sharif appointed Dar as finance minister, ahead of a national budget due this month. Dar, 63, will present the budget as sluggish growth and one of the region’s lowest rates of tax collection risks a widening of the fiscal deficit. He may also have to negotiate a bailout with the International Monetary Fund after foreign exchange reserves plunged 40 percent from a year ago, to less than two months of imports, according to central bank data.

Dar was commerce minister in Sharif’s first term and finance minister in 1999, when Pervez Musharraf seized power and dismissed the cabinet. He spent more than a year in jail under Musharraf over corruption charges that never went to trial.

He has a bachelor’s degree in commerce from the University of Punjab and has been a director of the World Bank, Asian Development Bank and Islamic Development Bank, according to his profile on the Senate website. He also served as finance minister for three months in 2008 until his party quit Zardari’s alliance.

Asif, a former privatization minister, will oversee the nation’s power and water ministry, according to the notification published in the state-run Associated Press of Pakistan, while Sartaj Aziz has been appointed as an adviser on national security and foreign affairs.

To contact the reporters on this story: Haris Anwar in Islamabad at hanwar2@bloomberg.net;

To contact the editor responsible for this story: Rosalind Mathieson at rmathieson3@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.