Federal Budget

Rupee in freefall: Gen Asim promises transparency in exchange rate

Rupee in freefall: Gen Asim promises transparency in exchange rate

Business

Businessmen demand greater control over official and open market

LAHORE (Web Desk) – As Pakistan rupee is experiencing a freefall producing multidimensional consequences for economy with everyone in the country already hit hard by the inflation, Chief of Army Staff Gen Asim Munir promised transparency in exchange rate and bringing currency exchanges into tax net.

The statement is of great significance as the difference between the Pakistan rupee and the US dollar in official exchange rate and open market is widening which is even higher when it comes to the black market.

According to the Lahore Chamber of Commerce and Industry (LCCI), the army chief expressed these views in a meeting with the business community at the Corps Headquarters in Lahore as they discussed a wide range of issues pertaining to economy and their impacts on the country.

“The money exchanges would be brought under the purview of taxation, fostering transparency in dollar exchange and interbank rates,” Gen Asim said.

In the context of the current state of affairs and the resultant statement, one has to keep it in mind that the IMF condition relating to market determining the exchange rate is responsible for the rupee depreciation.

Read more: IMF condition dragging Pakistan rupee down the slope with no stop in sight

That’s why the army chief made this promise after the delegation called for greater control on the money market.

He also highlighted the pivotal role of the Special Investment Facilitation Council (SIFC) which has the potential to attract $100 billion investment from Saudi Arabia, the UAE, Kuwait, and others.

Gen Asim also revealed the formation of task forces focused on economic matters and different sectors to bolster decision-making process.

As far as the demands made by the businessmen are concerned, they proposed a reduction in income and sales tax rates on electricity bills which had overburdened both the ordinary consumers and the businesses.

They also introduced a “pragmatic approach” to fuel adjustment charges, advocating for their collection during the winter months when electricity consumption is lower, alleviating financial stress on consumers.

Meanwhile, they also called for a unified commitment from political parties, suggesting the signing of a ‘charter of economy’ as a precondition before upcoming elections.

About Gen Asim’s earlier remarks regarding the existence of a grey economy which is reportedly much larger than the documented economy, they recommended incentivising the grey economy sector to transition into the formal.

They warned that expansion of tax base would remain elusive as long as the grey economy remained unincorporated.