Pakistan’s finance minister blames ‘political turmoil’ for depreciation of national currency

Pakistan's Finance Minister Miftah Ismail (C) speaks in a press conference in Islamabad on July 20, 2022. (Ministry of Finance)
Short Url
Updated 20 July 2022
Follow

Pakistan’s finance minister blames ‘political turmoil’ for depreciation of national currency

  • The Pakistani rupee hit a new historic low of Rs224.92 against the US dollar on Wednesday
  • Miftah Ismail says the country will save $2 billion in July due to measures taken to curtail imports

KARACHI: Federal Minister for Finance and Revenue Miftah Ismail blamed the country’s ongoing political turmoil for the rapid depreciation of national currency on Wednesday, as the Pakistani rupee hit another historic low of Rs224.92 against the US dollar.

Despite the recent staff-level agreement between Pakistan and the International Monetary Fund (IMF), the rupee has lost 4.5 percent of its value this week.

The finance minister said the recent depreciation of the Pakistani rupee was mainly triggered by the current political situation in the country, adding the market trend would reverse with greater stability and official measures taken to curtail imports.

“The rupee depreciation during the last two days is due to the political turmoil in the country,” he told a news conference in Islamabad. “Otherwise, there is no economic reason why the rupee is taking all be battering.”

“Our imports reached the historic high of $80 billion during the last fiscal year which continued to build pressure on the rupee throughout the year, particularly in the last six to eight months,” he added.

However, the finance minister said measures taken by the government to curtail the country’s import bill were producing encouraging results for the rupee.

“During the last three months, we tried to cut the imports and succeeded in June by reducing imports of non-energy products by 15 percent,” he continued. “However, the energy imports rapidly increased by 120 percent due their high costs. The overall imports were $7.4 billion out of which $3.7 billion were energy imports.”

“The measures have yielded the desired results and by July 18, 2022, the imports were recorded at $2.609 billion, or 20 percent below last year,” Ismail informed. “This indicates the imports will not more than $5.5 billion in this month. We will be saving around $2 billion on the imports which will also positively impact the rupee.”

However, the finance minister conceded all measures taken to curtail the imports had not worked and only some of them had succeeded.

“I do admit that some of the measures materialized and we benefited from them while others did not,” he said. “Restricting buildup units of vehicles and mobile phones have saved us foreign exchange.”

Asked about the recently signed agreement with the IMF, he said all measures recommended by the fund had been met.

“The agreement has been reached with the IMF and there is no hindrance,” he continued. “We have already met prior actions and there is no problem with the IMF program and we will not do anything that will create any obstacle. We expect that the IMF board will ratify the agreement and we will also get financing from the World Bank and Asian Development Bank.”

The finance minister reiterated the funding gap of $4 billion would be met through friendly countries in the form of oil and gas financing on deferred payment and deposits.

“A friendly country has assured $1.2 billion in oil financing on deferred payment and we hope it will be finalized in a few days,” Ismail said. “The facility will help fund oil worth $100 million per month. Another friendly country wants to invest $1-2 billion in stocks on G2G basis. The mechanism for that has been approved and sent to the Cabinet Committee on Legislative Cases for enactment of law. One more friendly country has agreed to give gas on deferred payment worth $200-300 million.”

The finance minister said he even expected more than $4 billion from a friendly nation in the form Special Drawing Rights (SDRs) and investments during the current fiscal year.

“A friendly country has asked to deposit $2 billion and another friendly country has asked to give $2 billion under SDRs. In fact, we estimate that the amount will be far more than $4 billion and exceed $8 billion during this year,” he maintained.

Ismail said he expected to receive $2-3 billion through investment in Balloki and Haveli Bahadur Shah power plants in Punjab on the G2G arrangement with some friendly nations.

He noted the government was trying to create a balance between imports and exports to curtail the increasing trade and current account deficits. “We are trying strike a balance by making imports equal to exports and remittances.”

Miftah ruled out the country would need to import diesel next month, saying it had enough of the commodity in its stock to last for 60 days.

 


Saudi Arabia’s digital Hajj system ‘highly stable, foolproof’ — Pakistan Hajj organizers’ association

Updated 10 sec ago
Follow

Saudi Arabia’s digital Hajj system ‘highly stable, foolproof’ — Pakistan Hajj organizers’ association

  • Association says Hajj organizers have been transferring funds to Office of Pilgrims Affairs Pakistan account since 2024
  • Saudi Arabia’s digital Hajj system has been operating transparently and securely for a long time, says association

KARACHI: The Hajj Organizers Association of Pakistan (HOAP) this week described Saudi Arabia’s digital Hajj system as “highly stable” and “foolproof,” crediting the Kingdom for operating it transparently for a long time. 
Local news outlets this month published reports stating Pakistani pilgrims could face delays in their Hajj journey as millions of Saudi Riyals meant for their expenses were mistakenly sent to an account linked to the Organization of the Petroleum Exporting Countries (OPEC). An official at Saudi Arabia’s Ministry of Hajj and Umrah on Tuesday rejected the reports, reiterating the Kingdom’s electronic Hajj system operated with the “highest standards of transparency.”
HOAP clarified that local media reports had misreported the briefing its representatives had given to the Senate and National Assembly Standing Committee on Religious Affairs on Apr. 23. HOAP said its representatives had referred to the Office of the Pilgrims Affairs Pakistan (OPAP) account, not OPEC. It further said Hajj organizers have been transferring their funds to OPAP’s account since last year. 
“The Hajj Organizers Association of Pakistan would like to clarify that the digital system of Saudi Arabia is highly stable and foolproof, leaving no room for any kind of ambiguity,” the association said on Wednesday. “The Hajj system of Saudi Arabia has been operating transparently and securely for a long time, and we continue to benefit from it.”
The association clarified it has never been a part of any “political campaign,” alleging that local media’s misreporting is the “outcome of a conspiracy, which is equivalent to harming the long-standing relations between Saudi Arabia and Pakistan.”
“We have religious harmony and heartfelt affiliation with Saudi Arabia. We and our Government of Pakistan have longstanding relations with Saudi Arabia, of which we are proud,” it added. 
This year’s annual pilgrimage will take place in June, with nearly 89,000 Pakistanis expected to travel to Saudi Arabia under the government scheme and 23,620 Pakistanis through private tour operators. The total quota granted to Pakistan was 179,210, which could not be met. 
Pakistan kicked off its Hajj flight operations on Tuesday morning with the first batch of 442 pilgrims departing from Islamabad for Madinah.


Pakistan slashes petrol, diesel prices by Rs2 per liter till next fortnight

Updated 54 min 48 sec ago
Follow

Pakistan slashes petrol, diesel prices by Rs2 per liter till next fortnight

  • Price of petrol after reduction is Rs252.63 per liter, high-speed diesel Rs256.64 per liter
  • Fuel prices in Pakistan are reviewed fortnightly owing to fluctuations in global oil prices

ISLAMABAD: The Pakistani government has reduced the price of petrol and high-speed diesel by Rs2 per liter each for the next fortnight, state media reported on Thursday.

Fuel prices in Pakistan are reviewed and adjusted on a fortnightly basis. This mechanism ensures that changes in import costs are reflected in consumer prices, helping to sustain the country’s fuel supply chain.

The latest price reductions were undertaken due to the fluctuations in global oil prices. After the latest revision, a liter of petrol will now cost Rs252.63 while high-speed diesel will be sold at Rs256.64 per liter, according to a notification from the Ministry of Finance.

“The government has reduced prices of petroleum products for next fortnight,” Radio Pakistan said. “New prices are effective from today (Thursday).”

Petrol is primarily used in Pakistan for private transportation, including small vehicles, rickshaws and two-wheelers. Diesel, on the other hand, powers heavy vehicles used for transporting goods across the country.

Pakistan significantly increased fuel prices after securing a short-term, $3 billion loan from the International Monetary Fund (IMF) in 2023. The rising rates also led to spiraling inflation in the country, though the government started offering relief to the people by gradually bringing down the petroleum prices subsequently.

Since then the government has undertaken financial reforms and registered some economic gains in its quest to ensure Pakistan achieves sustainable economic growth. 
 


Pakistan reaffirms commitment to promote safe, dignified conditions for laborers on May Day

Updated 01 May 2025
Follow

Pakistan reaffirms commitment to promote safe, dignified conditions for laborers on May Day

  • Labor Day, observed on May 1, is a global celebration of workers’ rights and the labor movement
  • Laborers in Pakistan often work in dangerous places and exploitative conditions in mines, factories

ISLAMABAD: Prime Minister Shehbaz Sharif on Thursday reaffirmed his government’s commitment to ensure safe and dignified working conditions for laborers in Pakistan, as the world marks May Day to recognize the struggles of low-income workers.
Labor Day, observed on May 1, is a global celebration of workers’ rights and the labor movement. It honors the struggles and achievements of workers in securing fair wages, safe working conditions and dignity in the workplace. In many countries, including Pakistan, it serves as a reminder of the importance of social justice and the ongoing need to protect labor rights in the face of economic and social challenges.
Labor laws are rarely implemented in Pakistan, where laborers often work in dangerous and exploitative conditions at construction sites, mines and factories. In most instances in Pakistan, especially in the informal jobs sector, laborers are hired below the minimum wage set by the government and not provided proper safety equipment.
“Today, as the nation observes Labor Day, Pakistan reaffirms its unwavering commitment to promoting safe, healthy and dignified conditions for its workers — the real driving force behind our nation’s growth and resilience,” Sharif said in a message shared by his office.
“The protection of fundamental labor rights is enshrined in our Constitution and fully aligns with the International Labour Organization’s core conventions.”
Sharif noted Pakistan had undertaken legislative and administrative reforms in recent years to strengthen the protection of workers. He said the government took steps to broaden the coverage of the Employees’ Old-Age Benefits Institution (EOBI) and the Workers Welfare Fund.
Pakistan’s labor class has suffered immensely as the South Asian country desperately tries to escape a prolonged economic crisis. Inflation reached a record high of 38 percent in 2023 as Islamabad scrapped fuel and food subsidies to comply with the International Monetary Fund’s demands for a financial bailout package.


Heartbreak at the border: India-Pakistan tensions tear mother apart from her family

Updated 01 May 2025
Follow

Heartbreak at the border: India-Pakistan tensions tear mother apart from her family

  • Muhammad Imran visited New Delhi last month with his wife, an Indian national, for his son’s treatment for spinal injury
  • Imran was forced to leave India with children but without wife after India, Pakistan suspended visas for each other’s nationals

KARACHI: When Muhammad Imran arrived in neighboring India last month, he thought the journey would culminate in his son recovering from an unfortunate spinal injury. Little did he know that he would be forced to head back to Pakistan. That too, without his wife.
Imran, 43, traveled to India with his wife Nabeela Imran, an Indian national, and children in March clinging to the hope that doctors at New Delhi’s Apollo Hospital would help his 17-year-old son Muhammad Ayan walk again. Ayan was left paralyzed in 2023 after he suffered a gunshot wound in his spine after getting in the crosshairs of a gunfight between police and street criminals in Karachi.
However, ties between India and Pakistan deteriorated after New Delhi blamed Islamabad for being involved in a militant attack on tourists in Indian-administered Kashmir on Apr. 22 that killed 26 people. Islamabad denies involvement.
Both nations downgraded ties, with India suspending visas for almost all Pakistani nationals and Islamabad responding with tit-for-tat measures. The move triggered panic among visiting families — including Imran’s, who had married his maternal cousin Nabeela, a resident of New Delhi, 18 years ago.
Since then, Nabeela had been living in Pakistan on a visa that was intermittently renewed without her ever needing to acquire Pakistan’s nationality. But the suspension of visas meant Imran and his Pakistani children’s 45-day medical visa was no longer valid, and Nabeela was left behind in India.
“She was separated from us while crying and we also came here with great difficulty, crying,” an emotional Ayan told Arab News.
Imran said he arrived in India after spending “every single rupee” with the hope that his son would walk again. However, bilateral tensions between India and Pakistan, and the ensuing atmosphere in India made his family “very scared.”

Pakistani citizen Muhammad Ayan cries, as his mother, who is an Indian citizen couldn’t accompany him and his father, as they prepare to leave India after India revoked visas issued to Pakistani citizens, at the Attari-Wagah border crossing near Amritsar, India on April 27, 2025. (REUTERS)

“I told them, ‘I am married [to her],’ I pleaded with them, cried, and showed a lot of humility,” Imran said about his interaction with Indian authorities. “But they said, ‘No, write an exit and leave.’“
‘PEOPLE SHOULDN’T BE DIVIDED BY BORDERS’
For Ayan, the shock of being separated from his mother compounded the trauma of his paralysis and incomplete treatment.
“I went for treatment with a hope but that hope shattered because of that accident and then the fact that my mother was not coming with us,” he said.
“I was completely separated from a mother’s love. We were far apart; it made me cry.”
The ordeal is also tough for Imran, who is the sole caregiver to Ayan now that Nabeela is in India.
“Should I go to work or take care of my child,” Imran asked. “Because his mother used to handle everything — feeding him, taking care of him, and everything else.
“Now that she’s not here, I am facing a lot of distress,” he added.
Back in India, Nabeela is consumed by the same worry for her son.
“Over there, my child is paralyzed and in distress, and I am the one who takes care of everything for him,” she told Arab News via a video call.
“Now, his father will be going to work— who will take care of him? Who will look after him?“
Nabeela appealed to governments in India and Pakistan to reunite her with her children.
“I am in a lot of distress; I cannot live without my children,” she said. “My child is helpless, what should I do?“
Robbed of his mother’s affection, Ayan had the same plea.
“I appeal to both the Pakistani and Indian governments to reunite me with my mother as soon as possible,” he said.
 “And I also appeal to the Pakistani government to help me with my treatment,” he added. “Please reunite me with my mother.”
Imran recalled how he saw with his own eyes when many families were separated from their loved ones and sent to the border.
“Borders may exist but people shouldn’t be divided by them,” he said.


US urges Pakistan to cooperate in Kashmir attack probe, re-establish direct communications with India

Updated 01 May 2025
Follow

US urges Pakistan to cooperate in Kashmir attack probe, re-establish direct communications with India

  • US Secretary of State Marco Rubio calls Shehbaz Sharif, urges Islamabad to de-escalate tensions with New Delhi
  • Fears of war loom after Delhi accused Islamabad of being involved in Apr. 22 attack in Indian-administered Kashmir

ISLAMABAD: US Secretary of State Marco Rubio this week spoke to Pakistan’s Prime Minister Shehbaz Sharif, urging his administration to cooperate in investigating an Apr. 22 attack in Indian-administered Kashmir and to re-establish direct communications with New Delhi amid soaring bilateral tensions.
Pakistan’s Defense Minister Khawaja Muhammad Asif last week said Islamabad is willing to cooperate with “any investigation which is conducted by international inspectors” of the Apr. 22 attack in Pahalgam, a popular tourist resort in Indian-administered Kashmir, in which 26 tourists were killed. 
India has said there were Pakistani elements to the attack but Islamabad has denied any involvement. Fears of a wider conflict between the nuclear-armed neighbors breaking out loom as India has vowed to punish the backers of the Kashmir attack. Pakistan, on the other hand, has vowed a “strong” response to any military strike. 
Rubio spoke to PM Sharif on Wednesday, urging the need to condemn the Pahalgam attack, the US State Department said the same day. 
“The Secretary urged Pakistani officials’ cooperation in investigating this unconscionable attack,” the State Department said. “He also encouraged Pakistan to work with India to de-escalate tensions, re-establish direct communications, and maintain peace and security in South Asia.”
It added that both leaders reaffirmed their continued commitment to “holding terrorists accountable for their heinous acts of violence.”
According to Sharif’s office, the Pakistani premier asked Washington to impress upon India to “act responsibly” and “dial down the rhetoric.”
“He [Sharif] categorically rejected Indian attempts to link Pakistan to the incident and pointed to his call for a transparent, credible, and neutral investigation to bring out the facts,” the PMO said. 
Sharif told Rubio that India’s recent behavior is “deeply disappointing and worrisome,” saying it would only serve to distract Pakistan from its ongoing efforts to defeat militants, particularly those based in Afghanistan. 
Rubio also spoke to India’s External Affairs Minister Subrahmanyam Jaishankar on Wednesday, expressing sorrow for the loss of lives in the Apr. 22 attack. 
He also encouraged India to work with Pakistan to de-escalate tensions and maintain peace and security in South Asia, the State Department said. 
Several countries such as China, Saudi Arabia, Iran, Turkiye and the UK have also called upon both India and Pakistan to exercise restraint and avoid a military confrontation.