KARACHI: In just three weeks, the finance minister has been shuffled yet again. On April 16, the former finance minister Hammad Azhar was assigned the energy ministry. In his place, Shaukat Tarin, a former finance minister under the PPP government, has been appointed.
The decision confirms the rounds of rumours which floated after Azhar’s appointment, which speculated that Shaukat Tarin would soon replace Azhar.
Shaukat Tarin has confirmed his appointment to Profit.
The move is part of a series of cabinet reshuffles. For instance, the former energy minister Omar Ayub has been made the minister for economic affairs. The former information minister Shibli Faraz has been made the minister for science and technology. That post used to be headed by Fawad Chaudhry, who has been handed Faraz’s old position instead.
This is now the fourth finance minister the Pakistan Tehreek-e-Insaf government has appointed since 2018. Asad Umar, Hafeez Sheikh, and Hammad Azhar have held this position before Tarin.
Dejavu: Flashback to PPPs regime
In October 2008, Tarin had replaced Sheikh. Technically it can be said that Sheikh is replacing Tarin in the same way despite the fact that Hammad Azhar was guarding the spot. In July 2009, he was elected as a senator from Sindh and became the federal finance minister.
Following his induction in the PPP government, Tarin secured a bailout package of around $5 billion from the International Monetary Fund (IMF) saving the country from default on the repayment of foreign loans.
However, considering his position within Silkbank, in February 2010, Tarin tendered his resignation to the then PM Yousuf Raza Gilani in order to raise equity for the bank. Speaking to the media, Tarin had said, “I could not get the equity while working as a finance minister because of a clear conflict of interest.”
Tarin still sits on the board for Silk Bank.
Tarin the banker
Born to an army doctor in Multan, Shaukat Tarin holds an MBA from the University of Punjab and worked at Citibank for 22 years. At the peak of his career at Citibank, he served as the country manager for Thailand.
Following his stint at Citibank, Tarin moved to the US. It is said that his salary in the US was more than $1 million which he chose to forgo in favour of returning back to Pakistan at the request of the then Prime Minister Nawaz Sharif.
In 1997, on the behest of Sharif, Tarin returned to help revive Habib Bank, which was a state-owned entity at the time on the verge of extinction. In addition to Tarin, Sharif had sought help from Zubyr Soomro for United Bank and Muhammad Mian Soomro for National Bank.
Tarin managed to turn around Habib Bank from a $230 million loss in 1996 to a profit of $30 million in 1998.
In 2000, Tarin left Habib Bank and joined Union Bank as its president. For those that do not know, Union bank was Pakistan’s eighth-largest banks in 2006. It had 65 branches in 22 cities and around 400,000 customers. Under his presidency, Standard Chartered acquired a 95.37 per cent stake worth $487 million in the Union Bank.
In 2008, Tarin acquired an 86.55 per cent stake in Saudi Pak Commercial Bank from Saudi Pak Industrial and Agricultural Investment Co Ltd through a consortium that included Sadeq Sayeed, International Finance Corporation, BankMuscat, Nomura Holdings, and Sinthos Capital. This was later renamed Silk bank in 2009. This transaction was worth $213 million.
SilkBank, however, as of late, is in a dismal state. Moreover, Tarin has been elected twice as the chairman of the Karachi Stock Exchange (now: PSX).
Problems with NAB
Tarin faces longstanding trouble with NAB over the famous Rental Power Project case. The case has been ongoing for nine years. In 2012, the Supreme Court scrapped all deals made by the government with rental power plants set up since 2006 by declaring them illegal, non-transparent, and invalid. In addition, the SC ordered advanced payments made to nine RPPs along with interest to be recovered.
On the request of NAB, the names of all suspects in the RPP case were put on the Exit Control List.
What remains controversial is the fact that Tarin was averse to the idea of RPPs while NAB has accused him of approving RPP contracts during his time as Finance Minister during the PPPs regime. Due to this case the then PM, Raja Pervez Ashraf was titled Raja Rental.
In 2013, during proceedings, the NAB team questioned Tarin regarding his role in the RPP scandal, specifically questioning who cleared the payment for Naudero II RPP. Tarin maintained that he did so after the approval from PM Yousuf Raza Gilani and Raja Pervez Ashraf, the minister for water and power at the time. As per Tarin, he refused to approve the 50MW power project in Naudero without the approval of Gilani and the sponsor – Asian Development Bank.
Citing the problems associated with the case, Tarin asked for the case to be dismissed before he takes up the job of finance minister.
Is he related to sugar baron Jehangir Khan Tareen?
On April 1, 2021, Dawn reported that Tarin is a cousin of senior PTI leader Jehangir Tareen, another individual facing trouble with NAB. However, despite the similarity in name and trouble with NAB, the two are not related.
A link that did exist was that Shaukat Tarin was a member of the Economic and Finance Committee created by PM Imran Khan with Jehangir Khan Tareen, the convener of the committee.
Another indirect link that Profit was able to establish is that in 2010, Silk Bank had made term finance certificates investment in JDW Sugar Mills Limited, where Tareen is CEO. 38,400 certificates worth Rs 149,333 were held in 2010.