ISLAMABAD, Oct 24: The Asian Development Bank (ADB) has indicated to provide major guarantees to Pakistan for pooling insurance risk cover through local and international financial institutions and insurance companies.

Speaking at a press conference here on Wednesday Securities and Exchange Commission of Pakistan (SECP) president Khalid Mirza said the ADB had indicated to help Pakistan government on the question of reinsurance arrangements after January 1, 2002.

Asked whether the help is going to be some sort of grant or aid, the Securities and Exchange Commission of Pakistan chairman said “it can be a major guarantee”, adding that he had initially spoken to the ADB official on Wednesday.

Mirza said that he could “see pooling of financial institutions and insurance companies....perhaps some international institutions to provide the risk cover”.

He said that “international insurance companies have informed us.... and this endemic all over the world...that they would not renew their reinsurance treaties after January 1, 2002 in areas of civil commotion, terrorism and riots”.

“We are looking at it as to how to deal with the situation”, he said and added that a task force has been constituted to submit by November 10 a report that could be implemented.

He said the US Congress had moved a bill for pooling but because “we were very close to the military action, our risk insurance was higher”.

Mirza said that once the task force submitted its report, the SECP would study it and then take whatever measures required from the regulatory aspect and start implementation.