General elections only way out of ‘economic mess’, says Shaukat Tarin

Former finance minister Shaukat Tarin on Wednesday reiterated his call for holding general elections in the country, arguing that it will help Pakistan get out of the brewing “economic mess”.

“I want to tell the authorities that there is only one solution to get out of this political and economic mess, and that is to announce the general elections," said Tarin while addressing a press conference. "A credible interim government should be in place,” he said.

The Pakistan Tehreek-e-Insaf (PTI) Senator said that his party is willing to cooperate with the interim government.

Tarin's statement comes after Finance Minister Miftah Ismail said the rupee’s sharp fall was solely due to the political crisis in the country.

"Economic fundaments are stable,” said Miftah as he addressed a press conference earlier on Wednesday.

“Dollar is rising against all currencies. In fact, the dollar is at a 22-year high against a basket of strong global currencies. This is because the dollar is a safe haven investment,” he said.

Miftah said the SBP’s Real Effective Exchange Rate (REER) index shows only 3% depreciation since December 2021

The reactions by both Tarin and Miftah come as Pakistan's rupee has seen relentless depreciation, falling consistently throughout the ongoing week, and touching new lows.

On Tuesday, Pakistan's rupee closed at a record low of 221.99 against the US dollar, going as low as 224 during intra-day trading amid renewed political uncertainty that wrecked market confidence and also gave "speculators" additional fodder.

This was the highest day-on-day depreciation after June 26, 2019, said a post-market note from brokerage house Arif Habib Limited (AHL).

Reports indicate heavy import payments along with speculation as well as ongoing political uncertainty stemming from PTI's victory in the Punjab by-polls are major reasons for the fall. However, the US currency has also been rising on account of the US Federal Reserve's rate-hikes, which makes the dollar a more attractive currency.

Tarin said Miftah's repeated statements on economic fundamentals are not achieving much.

“Rupee's fall will result in price hikes and cause inflation. The PTI government maintained strong economic growth of 6% as it knew that the commodity super-cycle would weaken, which would bring the current account deficit and inflation downwards."