US Dollar 59.9 60
Bahrain Dinar 158 158.1
Canadian $ 50.85 50.95
Euro 70.75 70.85
Hong Kong $ 7.65 7.7
Japanese Yen 0.508 0.51
Kuwaiti Dinar 204 204.1
UK Pound 103.7 103.8
Last updated: Friday 23 Dec, 2005-12.30 P.M (PST)



In oC




Today 12 26 38 Sunny
Tomorrow 11 27 38 Sunny
Day after 11 28 38 Sunny
Today 1 20 87 Sunny
Tomorrow 2 20 87 Sunny
Day after 2 21 87 Sunny
Today 0 18 59 Sunny
Tomorrow 0 18 59 Sunny
Day after 0 21 59 Sunny
HUM%: Humidity In %
FOR.: Weather Forecast
updated: Fri - Sun 23-25 Dec, 2005




KARACHI         - 021 LAHORE          - 042 ISLAMABAD    - 051 FAISALABAD   - 041 MULTAN          - 061 PESHAWAR    - 0521 CANADA          - 1 KUWAIT           - 965 INDIA               - 91 IRAN                - 98 U.K                   - 44 U.A.E                - 971 U.S.A                - 1








Building economically viable enterprises through strong equity participation combined with management and technical expertise and support

Dec 26 - Jan 01, 2006

The Aga Khan, since assuming the office of Imamat in 1957, has been concerned about the well-being of Muslims, particularly in the face of the challenges of rapid geopolitical changes. Over the four decades there have been major political and economic changes around the world. The Aga Khan has adapted the complex system, pioneered by his grandfather, to a new world of nation-states, which even recently has grown in size and complexity following the newly acquired independence of the Central Asian Republics of the former Soviet Union.

The keen interest of the Aga Khan in Pakistan can be gauged by the large number of agencies involved in various economic spheres. A quick review of the work done in Pakistan shows not only diversity of programs but the aim remains improving the quality of life of people, be it education, healthcare or employment generation. The underlying objectives are to alleviate economic and social exclusion, diminish the vulnerability of poor populations and reduce poverty. All the programs aim at helping people becoming self-reliant and eventually gaining the skills needed to graduate to the mainstream markets.

The Aga Khan Development Network (AKDN) operates in more than 20 developing countries around the globe. The programs were previously distributed among the Aga Khan Fund for Economic Development (AKFED), the Aga Khan Foundation (AKF) and the Aga Khan Trust for Culture (AKTC), are now overseen by the Aga Khan Agency for Microfinance (AKAM). It is a not-for-profit agency created under Swiss law. Its headquarters are located in Geneva, Switzerland. AKAM is governed by an independent Board of Directors. The Chairman of the Board is His Highness the Aga Khan. The Agency's partners include the Canadian International Development Agency (CIDA), Kreditanstalt fur Wiederaufbau (KfW), International Finance Corporation (IFC), Norwegian Trust Fund, the Japanese Social Development Fund, the Dutch Trust Fund, US Agency for International Development, the Microfinance Investment Support Facility for Afghanistan (MISFA) and the European Commission.

Wherever the AKDN works the focus is health, education, culture, rural development, institution-building and the promotion of economic development. It aims at improving living conditions and opportunities for the poor, irrespective of their faith, origin or gender. Founded and guided by the Aga Khan, the AKDN brings together a number of development agencies, institutions, and programs that work primarily in the poorest parts of Asia and Africa. AKDN is a contemporary endeavor to realize the social conscience of Islam through institutional action.

AKDN agencies operate in social and economic development as well as in the field of culture. The Aga Khan Foundation (AKF), including the Aga Khan Rural Support Programs and the Mountain Societies Development Support Program, the Aga Khan University (AKU), Aga Khan Heath Services (AKHS), Aga Khan Education Services (AKES), and the Aga Khan Planning and Building Services (AKPBS) operate in social development. The Aga Khan Fund for Economic Development (AKFED) with its affiliates the Tourism Promotion Services, Industrial Promotion Service, and Financial Services, seek to strengthen the role of the private sector in developing countries by supporting private sector initiatives in the development process.

The Fund and the Foundation also encourage government policies that foster what the Aga Khan first called an "enabling environment" of favorable legislative and fiscal structures. The Aga Khan Trust for Culture (AKTC) coordinates the cultural activities. Its programs include The Aga Khan Award for Architecture, the Historic Cities Support Program, and the Education and Culture Program. The Trust also provides financial support for the Aga Khan Program for Islamic Architecture at Harvard University and the Massachusetts Institute of Technology in the United States.

While each agency pursues its own mandate, all of them work together within the overarching framework of the AKDN so that their different pursuits can interact and reinforce one another. Their common goal is to help the poor achieve a level of self-reliance whereby they are able to plan their own livelihoods and help those even more needy than themselves. A central feature of the AKDN's approach to development is to design and implement strategies in which its different agencies participate in particular settings. To pursue their mandates, AKDN institutions rely on the energy, dedication, and skill of volunteers as well as remunerated professionals, and draw upon the talents of people of all faiths.

The Aga Khan Fund for Economic Development (AKFED) is an international development agency which promotes entrepreneurship in the private sector in specific regions of the developing world. A for-profit institution, the Fund helps in building economically viable enterprises through strong equity participation combined with management and technical expertise and support. AKFED companies promote sustainable economic development in South and Central Asia and sub-Saharan Africa with projects in industry, tourism, and financial services.

AKFED operates local companies in three areas, which are industry, tourism and financial services. The industrial development sector includes companies ranging from agro-industry to metal products, printing and packaging, telecommunications and power generation. AKFED promotes tourism by building and managing hotels and lodges that contribute to economic growth in an environmentally sensitive manner. Financial institutions in AKFED's portfolio include banks, insurance and property management companies and micro-credit programs.

AKFED operates as a network of affiliates with more than 90 separate project companies employing over 15,000 people and controlling assets in excess of one billion dollars. The Fund is active in 15 countries that include Bangladesh, Burkina Faso, Congo, Cote d'Ivoire, India, Kenya, Madagascar, Mali, Mauritius, Niger, Pakistan, Senegal, Tajikistan, Tanzania, and Uganda. There are also affiliates in Canada, France, and the United Kingdom that provide resources and support to the Fund's activities in the developing world.

Whether in industrial development, tourism promotion or financial services, AKFED looks for projects that are not only economically sound, but also have long-term development potential for the country and the region. Its approach emphasizes the development of human resources, particularly management, technical, marketing, and financial expertise. The Fund brings together international investment and know-how with local experience and entrepreneurial skills, creating partnerships among local institutions and individuals, leading multilateral development agencies and development banks. AKFED plays a catalytic role in stimulating and mobilizing investment in the developing world. It facilitates participation by individual and institutional investors in national privatization programs and helps to create an enabling environment for private sector initiative.

Through direct participation in the management of companies in which it invests and through partnerships with institutional and individual investors, both domestic and foreign, AKFED builds strong local companies. This approach, combined with AKFED's sensitivity to the impact of its investments on the human and physical environment, helps to foster a sound and socially responsible private sector in the developing world. AKFED emphasizes equity investment, including participation in privatization programs and floatation of its companies' shares on national stock exchanges. This emphasis on equity investment demonstrates the highest level of investor commitment.

The Fund helps group companies to mobilize resources, identify management and staff, and structure finance and reporting systems, thereby ensuring the most appropriate manpower development and the application of relevant technologies. In addition to its own capital committed, AKFED brings together foreign and local partners to bridge the gap between support from government or international development agencies and the needs of local private entrepreneurs. In its investments, AKFED takes account of the impact on the human environment as well as the effect on the physical surroundings.

In its efforts to encourage the creation of strong and efficient capital markets, the AKFED provides institutional umbrella for banks, insurance companies, property owning and management companies and leasing companies in East Africa and South Asia. Many of these companies, including some which were founded as small self-help companies in the first half of this century by the present Aga Khan's grandfather and predecessor, Sir Sultan Mahomed Shah Aga Khan, have over the years developed into leading institutions quoted on national stock exchanges. The New Jubilee Insurance Company, for example, has grown into one of Pakistan's largest insurance companies and is quoted on the Karachi Stock Exchange.


On December 29, 2003, AKFED gave the highest bid of Rs. 22. 409 billion for acquiring 51% shares along with management control of Habib Bank. "The privatization of Habib Bank is a historic and the country's biggest strategic sale in the financial sector and we expect that the new buyer will improve the bank's network in Central Asia, Europe and other parts of the world to turn the bank into a prestigious Pakistani Bank," Dr. Abdul Hafeez Shaikh stated this while addressing the ceremony held for the transfer of the management of Habib Bank to Aga Khan Fund for Economic Development (AKFED). Addressing on the occasion Shaukat Aziz said, "Habib Bank is an icon of our structural reforms and we are handing over a jewel of our national assets with a bit of heavy heart and now the greater responsibility lies with the new management".

Habib Bank is Pakistan's second largest commercial bank, having a countrywide and international branch network. The bank has full service licence covering commercial, retail banking, consumer and investment banking activities in Pakistan and most of the other countries where it is present. It has an extensive domestic network consisting of 1,425 branches with a market share of approximately 20%. It also operates a large international network of 48 branches in 25 offshore locations spread over Europe, the Middle East, Far East, Asia, Africa and the United States. It also operates three wholly owned subsidiaries namely Habib Bank Financial Services in Pakistan, Habib Finance International in Hong Kong and Habib Finance Australia. It is also partner in two joint ventures namely Habib Nigeria Bank and Himalayan Bank. In addition, the Bank owns 90.5% shares in Habib Allied International Bank Plc, a bank incorporated in the UK.


The Aga Khan Rural Support Program (AKRSP) has been running microfinance initiatives since 1982 in the Northern Areas and Chitral district of Pakistan. By 2000 a total of Rs 429 million (over US$10 million) had been saved by members of more than 3,260 village organizations, with more than US$2 million disbursed in credit each year. The First Micro Finance Bank of Pakistan started operations in May 2002, initially taking over AKRSP's credit and savings activity, and began a program of urban micro credit in Rawalpindi and Karachi in 2003. It has gradually expanded to other rural and urban areas in the country, with 25-branch nationwide network. The Bank reaches out to disadvantaged populations which are currently not able to receive financial services from commercial banks. Specific emphasis is placed on vulnerable groups, women in particular. Savings are mobilized from individuals, groups and institutions. The Bank plans to establish about 30 branches by the end of the fifth year of operations. Mobile banking services are being provided gradually from all branches to expand outreach. The First Micro Finance Bank of Pakistan has earned "Honorable Mention" in the CGAP 2004 Financial Transparency Award competition sponsored by the World Bank-affiliated Consultative Group to Assist the Poor (CGAP).

It is expected that the financial institutions working under the guidance of AKFED will not only emerge as role model but will also provide other institutions an opportunity to benefit from their experience. It is necessary to reiterate at this point that for strengthening any economy, the strength of financial institutions is of prime importance.


Pakistan & Gulf Economist 2005    Privacy Policy   |   Terms of Uses