Currency manipulation won’t be allowed: Dar

KARACHI: Pakistan’s finance minister Ishaq Dar warned on Saturday that tough actions will be taken against those found manipulating the exchange rate.

Dar stated that the rupee’s actual value is below the 200 level against dollar.

In the premises of the State Bank of Pakistan, the minister met with the heads of exchange companies and the bank executives.

He issued a warning to those engaged in currency speculation and hoarding, predicting that the rupee will soon appreciate against the dollar.

“Where the rupee is at the present is not the right place. The rupee should trade between 180 and 200 to the dollar in the currency market,” he said.

According to Dar, under his former tenure, the dollar was in control and the interest rate was in the single digits.

Since the rupee has fluctuated significantly this year, authorities have begun to suspect bank and exchange company manipulation. So far this year, the rupee has lost 20.66 percent of its value against the dollar. The rupee unexpectedly increased in value in the last week of September after falling to record lows in July and August. Gains for the rupee occurred around Ishaq Dar’s fourth term as finance minister.

The rupee is now trading at around 222 to the dollar in the interbank market.

During a meeting with banks’ heads, the minister highlighting the overall economic outlook of the country shared that with the far-sighted and pragmatic policies of the present government, the economy of the country is on a trajectory path, according to a statement from the Ministry of Finance.

He further assured that the government’s financial situation is fully solvent and the government is fully committed to fulfilling its local and international commitments. The minister urged them to play their due role in financial and economic stabilisation and progress of the country, it said

The leading bankers of Pakistan reposed full confidence in the government’s macroeconomic policies and assured the minister their full support for the prosperity of Pakistan, it added.

Zafar Pracha, the general secretary of the Exchange Companies Association of Pakistan who also attended the meeting made important suggestions to the finance minister.

Paracha suggested that action should be taken soon against those who smuggle dollars again.

“We recommend to the minister that import should be linked with export. If there are exports of 100,000 dollars, imports of 200,000 dollars should be cleared instead, he said. “No permission should be given to commercial importers, but the import of commodities and industrial needs should be allowed,” he added.

Paracha also suggested that exchange companies should be given the status of the export industry, and steps should be taken to increase remittances.

He also said that the trade policy between Iran and Afghanistan should be re-examined.