KARACHI: Pakistan’s national currency on Thursday recovered 0.51 percent against the US dollar and closed at Rs175.52 following the revival of a stalled $6 billion International Monetary Fund (IMF) loan program, said analysts.
According to the State Bank of Pakistan, the rupee hit a historic low of Rs178.24 against the greenback on December 29. Its upturn on Thursday was the highest single day recovery since December 31.
“The recovery of the Pak rupee primarily owes to the revival of the IMF program and the foreign trade data,” Samiullah Tariq, director research at Pakistan Kuwait Investment Company, told Arab News. “The inflow of $1 billion sukuk proceed also played a key role in the positive market sentiment.”
The IMF executive board on Wednesday completed the sixth review under the Extended Fund Facility (EFF) for Pakistan, allowing the administration in Islamabad to draw $1 billion.
The international lending agency revived the loan program after the government met its several key conditions, including parliamentary backing to central bank’s full autonomy, uniform implementation of sales tax, and energy tariff hikes.
“The authorities’ recent policy efforts to strengthen economic resilience are welcomed. Timely and consistent implementation of policies and reforms remain essential to lay the ground for stronger and more sustainable growth,” Antoinette Sayeh, deputy managing director and acting chair of the IMF board, said in a statement issued after the meeting.
“The Pakistani economy has continued to recover despite the challenges from the COVID-19 pandemic, but imbalances have widened and risks remain elevated,” she continued, adding: “The adoption of amendments to the central bank Act is a welcome step toward strengthening its independence to pursue its mandates of price and financial stability.”
According to the IMF, Pakistan’s economy is set to continue recovering in FY2022, with real GDP growth projected at 4 percent. The fund also believes that inflation is expected to pick up this year before gradually slowing down.
The IMF statement maintained that continued commitment to a market-determined exchange rate and a prudent macroeconomic policy mix would help Pakistan reduce the current account deficit and ease external pressures.
However, it warned that Pakistan was vulnerable to possible flare-ups of the pandemic, tighter international financial conditions, a rise in geopolitical tensions, and delayed implementation of structural reforms.
“Strengthening the medium-term outlook hinges on ambitious efforts to remove structural impediments and facilitate the structural transformation of the economy,” the statement said. “To this end, increased focus is needed on measures to strengthen economic productivity, investment, and private sector development, as well as to address the challenges posed by climate change.”
Analysts said the revival of the IMF program could unleash foreign funding from other sources.
“The revival of the IMF program is an expression of confidence by the international lending organization. It will unlock financing from multilateral and other institutions, including the World Bank and Asian Development Bank,” Tariq added.
However, the country’s stock market did not show optimism and plunged by 114 points during the day to close at 45862.93.
“Investors seemed concerned over the dismal trade deficit data,” Ahsan Mehanti, chief executive of Arif Habib Commodities, said. “Apart from that, there was also an impact of 16 percent reduction in local cement dispatches in the country.”
Pakistan’s national currency strengthens against dollar after revival of $6 billion IMF program
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Pakistan’s national currency strengthens against dollar after revival of $6 billion IMF program
- The IMF executive board’s approval cleared the way for the release of $1 billion to Pakistan on Wednesday night
- Analysts say the revival of the IMF program can unleash foreign funding from other sources like the World Bank and ADB
Customs seize narcotics, smuggled goods, vehicles worth $4.9 million in southwest Pakistan
- Customs seize 22.14 kg narcotics, consignments of smuggled betel nuts, Hino trucks, auto parts, says FBR
- Smuggled goods enter Pakistan’s Balochistan province from neighboring countries Iran and Afghanistan
ISLAMABAD: Pakistan Customs seized narcotics, smuggled goods and vehicles worth a total of Rs1.38 billion [$4.92 million] in the southwestern Balochistan province on Tuesday, the Federal Board of Revenue (FBR) said in a statement.
Customs Enforcement Quetta seized and recovered 22.14 kilograms of narcotics and consignments of smuggled goods comprising betel nuts, Indian medicines, Chinese salt, auto parts, a ROCO vehicle and three Hino trucks in two separate operations, the FBR said. All items cost an estimated Rs1.38 billion, it added.
Smuggled items make their way into Pakistan through southwestern Balochistan province, which borders Iran and Afghanistan.
“These operations are part of the collectorate’s intensified enforcement drive aimed at curbing smuggling and dismantling illegal trade networks,” the FBR said.
“All the seized narcotics, goods and vehicles have been taken into custody, and legal proceedings under the Customs Act 1969 have been formally initiated.”
In the first operation, customs officials intercepted three containers during routine checking at FEU Zariat Cross (ZC) area. The containers were being transported from Quetta to Pakistan’s Punjab and Khyber Pakhtunkhwa provinces, the FBR said.
The vehicles intercepted included three Hino trucks. Their detailed examination led to the recovery of the smuggled goods which were concealed in the containers.
In the second operation, the staff of the Collectorate of Enforcement Customs, Quetta, intercepted a ROCO vehicle at Zariat Cross area with the local police’s assistance.
The driver was interrogated while the vehicle was searched, the FBR said.
“During interrogation, it was disclosed that drugs were concealed inside the spare wheel at the bottom side of the vehicle,” it said.
“Upon thorough checking, suspected narcotics believed to be heroin was recovered which was packed in 41 packets, each weighing 0.54 kilograms.”
The narcotics weighed a total of 22.14 kilograms, with an estimated value of Rs1.23 billion in the international market, the FBR concluded.
“The Federal Board of Revenue has commended the Customs Enforcement Quetta team for their effective action and reiterated its firm resolve to combat smuggling, illicit trade and illegal economic activities across the country,” it said.
