Massive withdrawals by USA and UK, amounting to some $9.8 million, on July 24 forced the Special Convertible Rupee Accounts (SCRAs) to dip down to a little over $5 million. The SCRAs had earlier jumped to $19.4 million on July 18 after posting successive though gradual increases.
They had suffered the first major setback of the year on July 21 with balances dipping down to less than $16 million. Individually, USA investors withdrew some $7 million on July 24 reducing the balances to $-2.6 million. UK investors followed suit. They withdrew over $3 million as on that date reducing their balances to minus $2.5 million during FY07 so far.
Switzerland also withdrew about $0.8 million with its total withdrawals reaching close to $9 million during the first 24 days of the year. Investors from Hong Kong also withdrew a small amount of $0.2 million though they still have about $4 million in their SCRAs. Altogether the four countries withdrew $10.8 million from their accounts.
Other countries neither withdrew any amount nor brought in any. Singapore, thus, continued to be the leading investor in FY07 so far reaching $15.6 million on 19th July and sustaining the level through to July 24. Hong Kong still occupied the 2nd position.
The heightening of tensions between India and Pakistan might be one of the reasons behind the development besides the SBP's aspersions and dislike about the rising level of portfolio investment and the vulnerability connected with it as expressed in its latest quarterly report on the state of the economy (cf. BR July 18) followed by 5 percent increase in the CRR and its likely application to SCRAs. KSE 100 Index, in the meanwhile, advanced to 10,351 on 24th after posting gains of about 93 points over 10,258, the level obtaining on 21st July.
(Report by research.dept@aaj.tv)