Federal Budget

Pakistan rupee up Rs4.50 as govt goes after market manipulators

Pakistan rupee up Rs4.50 as govt goes after market manipulators

Business

Local currency has been able to reverse the depreciation trend in recent days

KARACHI (Dunya News/Web Desk) – The Pakistan rupee continued gaining lost ground against the US dollar as it started the new business week with a Rs1.95 surge in early interbank trading on Monday by reaching the Rs301 level – a trend coinciding with the government crackdown on smugglers and market manipulators.

Meanwhile, the situation in open market is improving at even more rapid rate as the local currency was up Rs4.50 and traded for Rs300.50 by the time this report was around 11:25 am.

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On Friday, the local currency had closed at Rs302.95 after appreciating by Rs1.99, or 0.66 per cent, against the dollar, which trading higher against most of the currencies around the world in recent weeks.

At the same time, the dollar exchange rate was recorded a Rs3 in open market and sold for Rs305, meaning the difference with the interbank value stood 1pc by the time the last business week had closed.

However, the rupee still needs to appreciate more so that the people and the businesses can feel the effects of this positive trend as rising fuel prices as well as power and gas tariffs have been fuelling inflation.

Currently, the biggest challenge for Pakistan is controlling the currency market as transfer of dollars through “hawala hundi” and smuggling of greenback across the Pakistan-Afghan border have caused its shortage while also fuelling the exchange rate to record-high levels in recent weeks.

A report has revealed that 722 currency dealers are involved in ‘hawala hundi’ business with 205 of them based in Punjab – certainly not a surprise given a large number of expats from Gujranwala, Gujrat and surrounding areas being in Western countries with most human smuggling cases also originating from the same region.

Khyber Pakhtunkhwa – for being the centre of dollar smuggling to Afghanistan – is second placed on the list with 183 such dealers.

And despite being sparsely-populated, Balochistan has 183 currency dealers dealing in hawala and hundi because of the lucrative business of smuggling dollars across Pak-Afghan border.

The number of dealers for other regions are: Sindh 176, Azad Kashmir 37 and Islamabad 17.