Daily Times

KCCI president Muhammad Idrees expressed deep concern over the continued devaluation of the rupee against the dollar, which hit a new all-time high by crossing Rs186, and urged the SBP to take action and devise an effective strategy to stop further devaluation rupees, which was having a deep negative impact on the economy, particularly inflation.

But even if analysts are blaming it on political instability, the SBP has to play a role otherwise it will create a lot of problems for Pakistan’s economy that is sinking due to widening current and fiscal deficits,” the SBP’s chief economist, Shahbaz Sharif, stated on Tuesday in a statement.

There has been an increase in the cost of doing business, making Pakistani goods uncompetitive in export markets and unaffordable for common people at the local market because the impact of rising dollar value is usually passed onto end users. The devaluation is hurting and has reached a point where it has become unbearable, he said. He said that the share of exports in GDP stood at around 10pc, while the rest of 90pc was local trade and imports. Prices of practically all common home goods have risen abnormally recently due to a lack of efficient price control mechanisms, he said, and this must be addressed in order to relieve the already burdened and miserable lives of the inflation-stricken common man.

According to him, the rupee’s devaluation has pushed up the cost of doing business and fueled inflation, thus the regulator needs to rethink its current policies. Head of Pakistan’s Chambers of Commerce & Industry (KCCI) expressed his fear that Pakistan’s economy would reach a point of ‘no return’ if the current political uncertainty continues. “All the efforts made to maintain GDP growth of 5pc plus will go wasted if the ongoing political uncertainty continues for long period.”