Currency dealers offer $24b in loans to govt

Currency dealers in open market have offered loans of $24 billion to the government for the next two years to help it stay away from the International Monetary Fund (IMF) programme, which has badly hit Pakistan’s economy.

Talking to The Express Tribune, Exchange Companies Association of Pakistan (ECAP) President Malik Bostan said, “We have offered $1 billion a month in financing to the government for the next two years to get rid of the IMF.”

The government must pass an order to allow exchange companies to borrow US dollars directly from overseas Pakistanis, foreign firms and global exchange companies, he emphasised.

The loans will be free of cost and can be rolled over, if required. “We are in contact with millions of expatriate Pakistanis as they are our clients. They are ready to lend $1 billion a month to us (exchange companies) over the next 24 months, in addition to the usual inflows received by exchange companies.”

Bostan, along with other office-bearers of the association, floated the proposal in a meeting with Senate Standing Committee on Finance Chairman Saleem Mandviwala in Islamabad.

Central bank officers and other high officials were present in the huddle.

“Exchange companies are already supplying $300-400 million a month, totalling $4 billion a year, to the inter-bank market,” he revealed, adding that the IMF had continued to come up with new conditions one after another, making it tough for Pakistan to give a push to its economy.

He asked the government to further review its laws, rules and regulations for IT freelancers, who had deposits of billions of dollars in foreign banks. “If the regulations are softened, they will bring these deposits to Pakistan.”

In February 2023, Finance Minister Ishaq Dar gave the go-ahead to Saylani Welfare Trust to raise $2 billion from overseas Pakistanis.

On Wednesday, Pakistani rupee maintained its downtrend for the second consecutive day, dropping 0.13%, or Rs0.37, to a one-week low at Rs283.92 against the US dollar in inter-bank market. The rupee had closed at Rs283.55 to a dollar on Tuesday, according to the SBP.

Published in The Express Tribune, March 30^th, 2023.

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