Karachi, September 13, 2021 (PPI-OT): Chairman of National Business Group Pakistan, President Pakistan Businessmen and Intellectuals Forum, and All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain on Monday said home remittances are increasing helping the government reduce the trade deficit and finance import bill.
Remittances remained above two billion dollars since June 2020 while average volume has remained 2.7 billion dollars since six months, he said. Mian Zahid Hussain said that Pakistan is receiving seventy percent remittances from Saudi Arabia, UAE, UK and the USA while twenty percent of the remittances are coming from Gulf and European countries.
Talking to the business community, the veteran business leader said that remittances have increased due to pandemic, travel restrictions, fall of hundi business, and positive initiatives of the central bank. The SBP has reduced TT charges and introduced some measures to lure people to opt for legal channels which are paying dividends he said.
He noted that global economic recovery and relaxations in travel restrictions have not dented remittances. Increased remittances are good for economy but at the same time unnecessary imports and import of food items are draining the forex reserves which must be controlled as it is eroding the exchange rate. Food imports are not only a drag on the scarce resources but it are also contributing to food inflation hitting entire population while the gap between exports and imports is also weakening the local currency.
The rupee is losing value against all important currency while it fell below Rs168 to a dollar which has raised concerns, he said, adding that the dollar has increased its value by one rupee in one week which has stoked inflation and added to the public debt. He said that policy to allow the rupee to find its equilibrium against foreign currencies has opened floodgates of inflation therefore the policy should be reconsidered.
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