Monday saw crushing of local currency against the dollar rate which moved well over Rs. 108 in the open market. This shifted 70% of the business of remittance to hawala system which was seen offering a rate of Rs. 109 per dollar, as said by the currency dealers.
State bank has not been successful in stopping the currency dealers from letting the local currency sink against the green bucks, despite several meetings with the latter.
General Zafar Paracha – Exchange Companies Association of Pakistan’s Secretary said, “The dollar touched as high as Rs108.40 in the open market and could go further up since its supply has hit the bottom,”
The sole reason for an appreciation in the dollar rate, as given by the currency dealers is the shortage of it the market. They said that the demand for the currency is not high. Mr. Paracha further said, “The most serious (problem) is the shift of remittances towards hawala trading. I believe 70pc of inward remittances are being channelised through hawala,”.
Dealers laid their concern that the inflow of the remittance will get negative impact due to hawala business. They said that the interbank and open rates have gone ahead Rs. 4/ dollar. In the interbank market, the dollar is present at Rs. 104.85.
According to Anwar Jamal – currency deal said, “The dollar has gained Rs2 per dollar against the local currency during the current month,” In the start of November, the dollar amounted to Rs. 106.20.
Others stated that the sole reason for a shortage in dollars in the country is due to banning of Rs. 500 and Rs. 1000-rupee currency note in India. The currency got converted to dollars and came to India resulting in a shortage from Dubai.
Mr. Paracha said, “The dollar and other currencies, which would usually come into Pakistan, are now being sent to Afghanistan. From there, the Pakistani currency is sent to Pakistan for the payment against foreign currencies at a very high rate while foreign currencies are sent to India,”.
The currency, other than dollars, that used to be exported to Dubai landed in Pakistan as dollars, adding to a significant business. It has all ended now.