Unrealistic idea

This refers to the letter ‘Saving remittances’ (December 16, 2022) by Malik Tariq Ali. The letter’s suggestion does not seem workable. It will cost the national exchequer a colossal Rs300 billion annually if implemented. The writer has not accounted for how this huge cost would be funded by the government as it is already facing a mammoth budget deficit and the IMF is demanding it be cut.

The letter fails to dissect the actual reason for the large difference in the interbank rate and the real open market rate. The government needs to revisit its imprudent exchange rate policy that is devastating the economy. The official exchange rate of dollars to rupees has been kept artificially, which is discouraging exports and remittances through official channels while making imports cheaper. It is the same approach which Ishaq Dar adopted during his previous stints as the chief of finance, with disastrous results.

Kulsoom Arif

Karachi