Sudden drop in dollar's value turns all export businesses to the red

Sudden drop in the US dollar's value against the Pak Rupee has turned all the export businesses in red while the exporters have suffered huge losses during last 10 days. Payments expected to be realised at Rs 105 were received at 6-8 percent less value as against thin margin of profit which ranges from one to 2.5 percent due to energy crises and higher cost of doing business, said a renowned leather exporter and Pakistan Tanners Association (PTA)'s former Chairman Agha Saiddain while talking to Business Recorder on Thursday.
While criticising the government policies, Agha Saiddain said authorities concerned must realise the ground realities, as exporters could not survive in turbulent rupee-dollar parity. "We are not interested in devaluation of the local currency at all but simultaneously we want the government to maintain exchange rate which should not be so humpy and fluctuating that was seen in last few days," he maintained.
He was of the view that both rates of Rs 110 and Rs 99 against a dollar were not suitable to the exporters because customers always asked for price reduction when Pak Rupee dropped suddenly. Moreover, importers did not accept higher prices of Pakistani merchandises due to weaker dollar, he added. He further said that sudden increase and drop showed that the government had no control over the exchange rate. "The policymakers take credit of the free market situation and blame the bankers when exchange rate goes up. The policymakers have set exchange rate on auto pilot and nobody realises the difficulties that exporters are facing," he maintained.
The PTA former chairman suggested the government not to politicise exchange rate, which could have serious repercussion on countries economy and balance of payment. He further said the government should evolve a strategy to protect the exporters besides stabilising the local currency at a rational level, which would not only benefit the people of Pakistan but also help increase the local as well as foreign investors' confidence in the country's economy.