From Zeeshan Mirza
KARACHI: The State Bank of Pakistan (SBP) Monday allowed all exchange companies to export foreign currencies other than the US dollar and bring in the greenback in their foreign currency accounts maintained with banks in Pakistan.
In a statement issued in this regard, the central bank clarified that this decision has been taken to enable the exchange companies to divert the flow of foreign exchange, mobilised by them, towards the interbank market. Pakistan-Kuwait Investment Company Head of Research Samiullah Tariq told media that the move taken by the state bank is going to improve the dollar supply in the market. “It has been decided to allow the exchange companies to export US dollar on a consignment basis through cargo/security company,” the SBP said, directing firms to ensure the availability of a sufficient amount of US currency notes at their counters to meet the demand of the general public.
The central bank said that it should also be ensured that the proceeds of such export must reach in US dollar account of the exchange companies maintained with banks in Pakistan, within three days of such export. “Exchange companies shall surrender 100% of foreign exchange received on the export of US dollar, in the interbank market on the same day,” the statement read, adding that this facility will be available until September 30, 2022.
All the firms are further directed to share data on such export and their surrender on a daily basis to the SBP, Banking Supervision Department – 3.
Meanwhile, exchange companies should also ensure the availability of all relevant records for examination by State Bank’s inspection teams.
“Any violation of these instructions by exchange companies would attract enforcement action under the relevant provisions of the Foreign Exchange Regulation Act, 1947,” the central bank warned.
The development comes after US dollar’s slide against rupee in the interbank and open market continued unabated on Monday, after Pakistan has inched closer for receiving a tranche of US$1.17 billion from IMF. According to forex dealers, the dollar shed Rs2.49 in the interbank to trade at Rs213 while the banks are selling the greenback at Rs212.
In open market, the US dollar lost Rs2 and traded between Rs212 and Rs213. The Pakistani rupee on Friday gained Rs 4.38 against the US dollar in interbank trading, while the banks are selling the US dollar at Rs215, forex dealers said.
In open market, the dollar declined by Rs2 and traded between Rs212 to Rs213. The US dollar shed Rs4.38 in the interbank Monday and traded at Rs214.50. The rupee got its strength amid an assurance from the IMF for the release of a USD1.17 billion tranche. On August 02, IMF confirmed that Pakistan has achieved all the set targets for the revival of Extended Fund Facility (EFF) programme.
Talking to media, IMF resident representative in Islamabad, Esther Perez Ruiz said Pakistan has achieved all the financial targets set by the fund and the last action was accomplished on July 31 by extending levy on petrol.
Ruiz said the 7th and 8th reviews have been completed and the Fund’s Executive Board will meet in the third week of August.
On July 14, IMF and Pakistan reached a staff-level agreement for the release of US$1.17 billion under the combined 7th and 8th reviews of Pakistan’s EFF. A statement issued by the Fund said that the agreement is subject to approval by the IMF’s Executive Board.
