'Seismic shift' to take interest out of banking sector.

ISLAMABAD -- After challenging the Federal Shariat Court's (FSC) decision on the interest-free banking system some four months ago, the government had a major change of heart on Wednesday, saying that it now wants to rid the country of Riba as soon as possible.

In a pre-recorded video message, Finance Minister Ishaq Dar announced that the State Bank of Pakistan (SBP) and the National Bank of Pakistan (NBP) would be immediately withdrawing appeals against an April decision of the FSC in which it gave the government five years to eliminate Riba (interest-based) banking from the country.

'With the permission of Prime Minister Shehbaz Sharif and consultations with the SBP governor, I am announcing a decision of the PDM [Pakistan Democratic Movement] government that both the SBP and NBP would withdraw their appeals filed in the Supreme Court of Pakistan against the FSC order within the next few days,' Mr Dar said.

He said the FSC had in the recent past given a judgement to transform the country's banking...