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Home » Karachi

BMP says foreign exchange dealers should not play our economy to gain some bucks

May 18, 2019

KARACHI:Chairman Businessmen Panel, Mian Anjum Nisar on Saturday said one should understand free float dollar is not suitable for Pakistan economy; our economy is very small.

“I urged market players don’t play with our economy just to gain some bucks”. Rupee devaluation seems an open market policy now. It appears they have decided to adopt it,” he said in a statement.

He said Pakistan is currently facing significant economic challenges, with declining foreign exchange reserves, diminishing growth and increasing trade deficit.

He said rupee once again weakened to a record in an apparent devaluation, five days after the Government secured a bailout from the International Monetary Fund that investors speculate includes tough conditions to reform the economy.

The rupee dropped to 149 a dollar which showed making it the worst performer in a basket of 13 currencies in Asia. Even in Afghanistan one dollar equal to 79 afghani and in Nepal one dollar equal to 112 Nepali ruppee.

Though the State bank of Pakistan had devalued the currency five times last year and raised interest rates by 475 basis points as it sought to contain the financial blowouts from Pakistan’s twin current-account and budget deficits.

Nisar said instead of structural reforms, cut the expenditures of the government, shut down the irrelevant Miniseries as they were around nine ministries in Federal Government which have no use or may merged with each other, but Government went for an easy option to adopt IMF loan with was not even big compared to their terms.

“If Prime Minister may pledged to nation that after successful three years of IMF program dollar would reverse back against rupee and our exchange rate will be seen around 120 rupee then we as a business community support this, if dollar will not reverse after three years and keep increasing like this; then this IMF program will not a suitable, yet instability and speculations are on high side which is not a good omen for industry”. he added.

However, despite currency devaluation and subsidies offered to various sectors, the country’s exports declined by 1.54 per cent during April, according to latest data released by the Pakistan Bureau of Statistics.

PBS data shows that exports during the month of April declined to $2.094 billion compared to $2.127bn during the same period last year.

Moreover, export proceeds during the first 10 months of the current fiscal year also fell by 0.12pc to $19.169bn compared to $19.191bn last year. Cumulatively, in rupee terms, exports recorded 23pc growth during the period under review.

Meanwhile, Businessmen Panel for FPCCI has also appreciated the appointment of tax expert Shabbar Zaidi as chairman of the Federal Board of Revenue (FBR).

Shabbar Zaidi is a well-respected tax professional, who has been closely associated with tax policy and administration in Pakistan for many years. His appointment as the FBR chairman by the government is very commendable, as it will strengthen the FBR capacity substantially.”

It may recall here World Bank’s 2019 Ease of Doing Business (EODB) rating, Pakistan was assessed as the 17th worst country in the world on the parameter of ‘paying taxes’.

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