KARACHI: President, Pakistan Business Forum (PBF) Khawaja Mehboob ur Rehman urged the Finance Minister Muhammad Aurangzeb for the measures in order to strengthen the rupee for the economic revival in real terms and to support industry and agriculture sector.
In a letter to the minister, the PBF president expressed deep concerns regarding the undervaluation of the rupee against the US dollar.
The letter stated that over the last five years, we have witnessed a troubling trend of unnecessary depreciation, which has severely impacted both our agricultural and industrial sectors.
He said the exchange rate dynamics in neighboring countries clearly highlight a significant disparity; their currencies remain much stronger compared to the PKR.
From 2008 to 2013 and 2018 to 2022 were particularly bleak for the value of the rupee, causing widespread economic instability and challenges for businesses.
While the recent IMF package has provided a much-needed boost to our foreign reserves, the fundamental issue of currency depreciation continues to hinder economic progress.
We believe that the PKR should be valued at approximately 230 against dollar. Until we can appreciate our currency, the real inflation affecting the ground realities for our citizens will remain unaddressed.
The persistent depreciation has resulted in high input costs, making it increasingly difficult for local industries to compete effectively.
This scenario not only stifles domestic production but also curtails our export capabilities, leaving us unable to achieve significant gains in international markets.
Furthermore, as we reflect on our 76 years of independence, it is disheartening to note that the PKR has consistently trended downward.
If this trend continues unchecked, we could find ourselves facing an alarming exchange rate of around PKR 400 to the dollar within just a couple of years.
The persistent issues of trade deficits and current account deficits have long plagued our economy. It is crucial that we seek a balanced approach to address the strengthening of our rupee against the dollar, as the strengthen of our currency is a main fundamental to our economic health.
The PBF president also said we should called on stakeholders to come onboard to resolve the exchange rate issue as he emphasised that Pakistan’s currency is still undervalued.
“Around 91% of the economy is destroyed due to rupee devaluation,” he said.
Copyright Business Recorder, 2024
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