g20 principles urge them to promote technological and institutional innovation as a means to expand financial system access and usage. since financial exclusion is particularly pronounced in pakistan, both the government and the state bank of pakistan are addressing this challenge using innovative policy approaches and actions. there is a full commitment of the government to provide sustainable financial access to the under - served economic and geographic segments including youth, women, and smes. in this effort, the role of multilateral institutions and bis central bankers ’ speeches bilateral donors particularly the uk ’ s department for international development ( dfid ) has been critical. ladies and gentlemen! in pakistan rural population is above 60 % and most people living in rural areas drive their income directly or indirectly from agriculture. it employs around 45 percent of our total labor force. if we were to develop any logical linkage between the economic development of pakistan with any of the sectors, that sector would most probably be agriculture. agriculture plays a strategic role in ensuring food security, generating economic growth, reducing poverty & inequality. to combat poverty in rural sector, financial innovation needs to be targeted towards the productivity of the agriculture sector specifically to the productivity of “ small farmers ”, improvement in farmer ’ s education, and better availability of fertilizers, and agriculture equipments. financial services outreach in the rural sector can play the most indispensable role in this regard. ladies and gentlemen! promoting financial inclusion by developing agri credit market, rural smes and microfinance sector is one of the top priorities at sbp. over the past few weeks, state bank has taken some ground - breaking initiatives to uplift financing to the farmers and small and medium entrepreneurs : state bank has revamped prudential banks for agricultural financing whereby banks have been advised to formulate all - inclusive agri. finance policies and set up dedicated agri divisions within banks. under the revised prs, the scope of agri. financing has been widened to include value chain financing and islamic mode of financing. we have just revised the per acre credit limits for crops, orchards and forestry which were previously set in 2008. this was done to meet the enhanced credit requirements of farmers and also increase the agri credit portfolio of banks manifold. farming community and banks have been overwhelmed by this initiative. we all know the significance of livestock that accounts for 55 percent of agri. gdp. however, the share of credit to livestock is disproportionately small due to high risk perception. therefore,

for sme borrowers without changing prevailing end user rate for exporters. sbp has also provided regulatory support in designing and launching of prime minister youth business loans. sbp has issued instructions to the banks for participation in pm ’ s youth business loans and report financing under the scheme in their annual reports under csr initiatives. for successful implementation of the pm scheme, sbp is closely monitoring the progress of participating banks. sbp has also conducted twelve ( 12 ) training workshops on the program across pakistan and ajk to sensitize banks for their active participation in the pm scheme. ladies and gentlemen! now, sbp under the flagship ‘ financial inclusion program ’, funded by the uk aid, is about to unveil the financial innovation challenge fund round on innovative rural and agricultural financial services. the successful implementation of this challenge round requires utmost commitment and support from everyone who is present here. our deputy governor and my colleague mr. saeed ahmad will share with you the objectives and modalities of this fund and the sbp - managed fip in more details. i thank and welcome you all once again and hope that the stakeholders will join hands in getting behind this latest initiative to further enhance rural financial inclusion in pakistan. thank you! bis central bankers ’ speeches