The Pakistan Industrial and Traders Associations Front (PIAF) has urged the government to take action against shortage of dollar in local market, besides controlling surge of dollar against rupee. PIAF Chairman Irfan Iqbal Sheikh in a statement on Thursday said the local currency depreciation has inflicted heavy losses on the national economy. He expressed surprise over sudden appreciation of dollar in spite of record foreign reserves and smooth flow of remittances.
He called for launching a crackdown against illegal money changers, as cost of deals made by the businessmen with their foreign counterparts has increased manifold and the country loses at least Rs 57 billion over devaluation of just one rupee.
The illegal international transactions in dollar-denominations via Dubai are creating shortage of dollars in the Pakistani open market. As a result, the US dollar traded at Rs 108 in the open market during this week, which was in range from Rs 105-106 throughout 2016, he added. He said that local currency is losing position mainly due to gold smuggling from Dubai, eating up around $5 million daily.
The PIAF chairman asked the finance minister to direct the Federal Investigation Authority (FIA), Intelligence Bureau, Customs Intelligence and the State Bank of Pakistan to keep strict vigilance to control currency and bullion smuggling. He urged the SBP to immediately take notice of the situation which is causing panic in the currency market.
He said the widening current account deficit, excessive government borrowing, absence of foreign flows and lack of foreign investments, are the vital reasons for constant depreciation of Pak rupee.
The PIAF leadership stated that despite the fact that economic indicators are improving, growth continuing to gain momentum, inflation on a downward trajectory and credit to the private sector rebounding sharply yet the local currency is falling as low as Rs 108 against the greenback which is question mark for the economic managers of the country.