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Write down any three main causes of backwardness of banking system in Pakistan at the time of independence.

User Yoav Gur
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Final answer:

The backwardness of Pakistan's banking system at independence was due to lack of infrastructure, the uneven division of assets post-partition, and initial political turmoil, which left the country with limited banking services and expertise.

Step-by-step explanation:

The backwards banking system of Pakistan at the time of independence can be attributed to three main causes:

  1. Lack of established financial infrastructure due to centuries of colonial rule, where the British prioritized their own financial interests, leading to a drain of financial capital from the region.
  2. The partition of British India led to a division of assets and liabilities that disadvantaged Pakistan, particularly in terms of banking institutions and management expertise.
  3. Initial instability and political turmoil post-independence adversely affected the development of a sound banking sector, leading to issues in establishing a stable currency exchange system.

Pakistan inherited a banking system with limited coverage, inadequate services, and a lack of skilled professionals to operate and grow the sector effectively.

User Vaandu
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