Financial experts warn depreciation of Pakistan’s national currency may ultimately lead to social unrest

A currency broker stands near his booth, which is decorated with pictures of currency notes, while dealing with customers, along a road in Karachi, Pakistan on January 27, 2023. (REUTERS/File)
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Updated 05 February 2023
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Financial experts warn depreciation of Pakistan’s national currency may ultimately lead to social unrest

  • Economists say the declining value of rupee will further fuel inflation, leading to unemployment and increased poverty
  • The national currency is trading at its lowest level against the US dollar and official forex reserves are down to $3 billion

KARACHI: With Pakistan’s national currency hitting a series of historic lows against the US dollar since the removal of an artificial upper cap on the exchange rate, financial experts fear that ensuing unemployment and poverty could lead to mass social unrest across the country.

The Pakistani rupee has plunged by 16.5 percent to Rs276.58 since January 25 as pressure continues to build for import payments amid the country’s fast depleting foreign currency reserves.

The official reserves have declined to $3 billion, hitting the lowest level since 2000-01 when the forex with the central bank only stood at $1.6 billion. On average, Pakistan needs at least $5 billion to cover one month of import payments.

Speaking to Arab News, local currency dealers blamed the upper limit on the exchange rate in the interbank and open markets to keep the value of US dollar artificially low for causing major devaluation of the national currency.

“When we capped [the exchange rate] to keep [the value of the greenback] low, our inward remittances moved to the grey market and exporters also stopped their payments because the [dollar] rate was low in the bank and it was too high in the grey market,” Zafar Sultan Paracha, general secretary of Exchange Companies Association of Pakistan (ECAP), told Arab News in an interview on Friday.

“When we suddenly removed the cap after a long time, the dollar, I would say, came out with fury,” he added. “It seems that it has still not calmed down.”

The extreme shortage of dollar liquidity compelled the government to restrict import of goods, including industrial raw material and essential items, while commercial banks stopped issuing letters of credit (LCs) which left importers struggling to arrange the greenback for already placed orders.

Many Pakistani industries were either forced to shut down their production facilities or scale down operations, paving the way for mass layoffs.

“Because of the slowdown in the overall economic activity, decades high inflation and overall low production by the economy, it is expected that unemployment will increase and we are witnessing that at the moment as well,” Tahir Abbas, head of research at Arif Habib Limited, told Arab News.

The South Asian nation is currently experiencing one of the highest inflation rates that was gauged at 27.6 percent in January 2023. Previously, such levels were recorded in 1975.

Abbas said he feared the situation could lead to social unrest in the country.

“It is advisable for the government to resume the IMF [International Monetary Fund] program as soon as possible,” he continued.

The government began talks with the IMF last week in a bid to win approval for the disbursement of $1.1 billion under a bailout program the country signed with it in 2019 to stave off economic meltdown.

While the talks are scheduled to last until February 9, Prime Minister Shahbaz Sharif has already said the visiting mission of the international lender was giving tough time to the country.

However, finance minister Ishaq Dar has repeatedly said the situation is under control and the government hopes to maintain a substantially high dollar reserve by the end of the current fiscal year.

Economists said the country needed to complete the IMF program by June and should not go back to the fund for future bailouts since its programs reduce the pace of economic growth.

“The IMF program by design leads to reduced economic growth which leads to unemployment and increased poverty,” Dr. Ashfaque Hasan Khan, senior economist and former member of the government’s Economic Advisory Council, told Arab News.

“Such situation leads to deterioration of law and order and such signs are already visible in Karachi where muggings and snatchings at gunpoint have significantly increased,” he added.


Pakistan Business Council calls for collaborative efforts with UAE in investment, cultural exchanges 

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Pakistan Business Council calls for collaborative efforts with UAE in investment, cultural exchanges 

  • UAE is Pakistan’s third-largest trading partner after China and US, and a major source of foreign investment
  • Pakistan consul general in Dubai urges business leaders to explore opportunities in IT, agriculture and tourism

ISLAMABAD: The Pakistan Business Council Dubai on Wednesday said it aims to strengthen existing relations between Islamabad and Abu Dhabi through collaborative efforts in trade, investment and cultural exchanges, a statement from the Pakistan Consulate General in Dubai said. 
The UAE is Pakistan’s third-largest trading partner after China and the United States, and a major source of foreign investment valued at over $10 billion in the last 20 years, according to the UAE foreign ministry.
It is also home to more than a million Pakistani expatriates. Policymakers in Pakistan consider the UAE an optimal export destination due to its geographical proximity, which minimizes transportation and freight costs while facilitating commercial transactions.
Hussain Muhammad, the consul general of Pakistan in Dubai, met the new board members of the PBC Dubai at the Consulate General of Pakistan. Shabbir Merchant, the PBC Dubai chairman, shared the council’s strategic roadmap for 2025-2026.
“Mr. Merchant stated that PBC aims to strengthen the relationship between Pakistan and UAE through collaborative efforts in trade, investment and cultural exchanges,” the Pakistan Consulate General said. “He added that the Council is committed to avail opportunities for mutual growth and foster a deeper connection between the two nations.”
Muhammad appreciated PBC’s efforts in promoting Pakistan’s economic potential in the UAE, the statement said, adding that the Pakistani consul general also encouraged them to take concrete steps toward enhancing bilateral trade and investment between the two countries. 
“The Consul General emphasized the need for business leaders to explore opportunities in Pakistan’s diverse sectors, including IT, manufacturing, agriculture and tourism,” the statement said. 
“He said that Pakistan offers immense potential for investment and trade, with Special Investment Facilitation Council (SIFC) established as a single window to facilitate investors.”
The SIFC is a hybrid civil-military body formed in June 2023 to attract international investment, particularly from Gulf countries, in Pakistan’s key economic sectors such as tourism, mining and minerals, agriculture and livestock. 
Hussain urged the PBC to act as a bridge for creating new partnerships and expanding existing ones. 
Pakistan and UAE have stepped up efforts in recent years to strengthen their business and investment relations. In January 2023, Pakistan and the UAE signed multiple agreements worth more than $3 billion for cooperation in railways, economic zones and infrastructure, a Pakistani official said, amid Pakistani caretaker prime minister Anwaar-ul-Haq Kakar’s visit to Davos for the World Economic Forum’s summit.


Pakistan reports first polio case of 2025 from country’s northwest

Updated 48 min 16 sec ago
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Pakistan reports first polio case of 2025 from country’s northwest

  • Pakistan last year suffered from a surge in polio cases, reporting 73 infections countrywide 
  • South Asian country will hold first nationwide vaccination drive of this year from February 3

KARACHI: Pakistani health authorities confirmed this year’s first polio case on Wednesday from the country’s northwestern Khyber Pakhtunkhwa province, amid Islamabad’s attempts to stem the spread of the disease. 
Polio is a paralyzing disease with no cure. Multiple doses of the oral polio vaccine, along with completing the routine vaccination schedule for all children under the age of five are crucial to provide children with strong immunity against the disease.
The Regional Reference Laboratory for Polio Eradication at the National Institute of Health (NIH) confirmed that this year’s first case was reported from the northwestern Dera Ismail Khan district of the province. Last year, the South Asian country reported 73 polio cases countrywide.
“On Wednesday, Jan. 22, 2025, the lab confirmed one polio case from D.I. Khan,” the Pakistan Polio Eradication Program said in a statement. “D.I. Khan is one of the districts of South KP having 11 polio cases in 2024.”
Giving a breakdown of the 73 polio cases in 2024, the program said 27 were reported from southwestern Balochistan, 22 from KP, 22 from southern Sindh, and one each from the eastern Punjab province and the capital city of Islamabad.
Pakistan, along with neighboring Afghanistan, remains one of the last two polio-endemic countries in the world. In the early 1990s, Pakistan reported around 20,000 cases annually, but by 2018, the number had dropped to just eight cases. Only six cases were reported in 2023, and one in 2021.
However, Pakistan’s polio eradication efforts have faced several challenges in recent years, including attacks by militants and misinformation spread by religious hard-liners.
The Pakistan polio program is scheduled to hold the country’s first nationwide vaccination drive of this year from Feb. 3 to Feb. 9.


Pakistan’s space agency says rare ‘Planetary Parade’ to be visible from January’s last week

Updated 55 min 18 sec ago
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Pakistan’s space agency says rare ‘Planetary Parade’ to be visible from January’s last week

  • Planetary Parade refers to when four or more planets align in a straight line
  • Venus, Mars, Jupiter and Saturn will be visible to the naked eye, says space agency

ISLAMABAD: Pakistan’s national space agency said this week that people will be able to see the “Parade of the Planets,” a celestial spectacle in which four or more planets will line up in the sky, from the naked eye beginning from the last week of January till mid-February. 
A planetary parade, or planetary alignment, is a rare celestial event where multiple planets in our solar system align in a straight line or appear close together in the sky. This occurs when the orbits of the planets bring them together in a specific configuration.
“The lining up of four or more planets in the sky is usually called Parade of the Planets,” Pakistan’s Space and Upper Atmosphere Research Commission (Suparco) said on Tuesday. “Out of all these planets, Venus, Mars, Jupiter and Saturn will be visible to the naked eye.”
It said that since the moon will be a waning crescent on Jan. 25, from a moderately pollution free sky, Mercury, Venus, Mars, Jupiter and Saturn will appear within a similar celestial line.
The space agency said familiarity with constellations would make it easier for people to identify planets. It said many free stargazing applications were available to identify celestial objects in the sky.
“To find out the name of an object, access the app and point the device toward the object in the sky and the app will display the names of the objects toward which the app is pointed out,” Suparco said.
It said Mars would be visible on the eastern horizon in the constellation Gemini whereas a brighter Jupiter would be located in the constellation Taurus.
“If the sky is dark enough, you can also enjoy the beautiful Pleiades, Hyades, and the yellow star Aldebaran,” Suparco said. 
The space agency said high-powered binoculars or a telescope would be required to observe Uranus which lies in the constellation Aries.
It added that strong binoculars would be required to see Neptune in the constellation Pisces while Saturn and Venus would also be visible.


Imran Khan’s party says no talks with Pakistan government unless it forms judicial commissions

Updated 37 min 51 sec ago
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Imran Khan’s party says no talks with Pakistan government unless it forms judicial commissions

  • Khan’s party has demanded judicial commissions to probe protests of May 2023, November 2024
  • Government’s negotiation committee says will respond to demands by Khan’s party in writing on January 28

ISLAMABAD: Former prime minister Imran Khan’s Pakistan Tehreek-e-Insaf (PTI) party leader, Omar Ayub Khan, on Wednesday ruled out further negotiations with the government unless its forms judicial commissions to probe the May 9, 2023 and November 2024 anti-government protests, amid efforts by both sides to break the prevalent political deadlock in the country. 
Khan last month set up a negotiation committee of PTI members, including Omar Ayub Khan who is also the Leader of the Opposition in the National Assembly, to hold talks with the government to ease political tensions. During the third round of talks between the two sides on Jan. 16, the PTI presented its “Charter of Demands” in writing to the government. 
The party’s key demands include the release of political prisoners and the establishment of judicial commissions to investigate the May 9, 2023, and November 2024 protests. Khan’s brief detention on graft charges on May 9, 2023, had sparked countrywide protests that saw his supporters attack and ransack military installations in an unprecedented backlash against Pakistan’s powerful army generals. 
In November 2024, Khan supporters from across the country defied blockades from various parts of the country to arrive in the capital to demand his release from prison. The government says four troops were killed while the PTI says 12 of its supporters died in clashes between law enforcers and Khan supporters.
“I wrote this in a tweet last night and this is Imran Khan’s directives too: no commissions, no negotiations,” Omar Ayub Khan told reporters outside the National Assembly. “End of discussion, we don’t accept it. The [judicial] commission of May 9 and the commission of Nov. 26.”
The opposition leader’s statement came shortly after Irfan Siddiqui, a key member of the government’s negotiation committee, said it would respond to the PTI’s written demands on Jan. 28. 
When asked whether the committee had decided to form the judicial commissions, Siddiqui responded:
“We have not decided on the question of whether to form or not form [judicial commissions],” Siddiqui told reporters after a consultative meeting of the committee ended. 
“That is why deliberations are taking place. Had this decision been taken today, there would be no need to hold meetings tomorrow and the day after that,” he added. 
Siddiqui hoped negotiations between both sides would produce fruitful results. 
The talks opened last month as Khan had threatened a civil disobedience movement and amid growing concerns he could face trial by a military court for allegedly inciting attacks on sensitive security installations during the May 9 protests.
The negotiations also began two days after 25 civilians were sentenced by a military court to periods of two to 10 years of “rigorous imprisonment” in connection with the attacks on military facilities on May 9, 2023. Just days later on Dec. 26, another 60 civilians were sentenced by a military court to jail time ranging from 2 to 10 years.
Khan, facing a slew of legal cases from jail, says all charges against him are politically motivated to keep him and his party out of power. Khan had to sit out February 2024 general election as convicted felons cannot run for public office in Pakistan.
An anti-graft court last Friday sentenced the former premier to 14 years in jail and his wife, Bushra Khan, to seven years in prison, on charges of receiving land as bribe for a real estate tycoon in exchange for favors. Khan, his wife and the real estate tycoon have denied any wrongdoing in the case.


Pakistani cricketers Saud Shakeel, Noman Ali break into ICC top 10 Test rankings

Updated 22 January 2025
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Pakistani cricketers Saud Shakeel, Noman Ali break into ICC top 10 Test rankings

  • Saud Shakeel and Noman Ali were both instrumental in Pakistan’s recent Test win against West Indies in Multan
  • Shakeel moves up to number 8 in batter’s rankings as Noman Ali moves to number 9 in ICC bowler’s rankings

ISLAMABAD: Pakistani cricketers Saud Shakeel and Noman Ali have broken into the International Cricket Council’s (ICC) top 10 Test batter’s and bowler’s rankings, the cricket governing body said on Wednesday, after their recent heroics against the West Indies at home. 
Shakeel, Ali and spinner Sajid Khan were instrumental in Pakistan’s 127-run convincing victory against the West Indies in Multan last week. Noman grabbed six wickets in the Test match, including a fifer in the West Indies’ first innings that helped dismiss the Caribbean team before they could amass a sizable lead over Pakistan’s first innings total. 
Shakeel scored a heroic 84-run knock to steer Pakistan out of the woods in the first innings, helping the team reach 230 runs before they were dismissed. 
“Batter Saud Shakeel and bowler Noman Ali are Pakistan’s big movers in the newly updated ICC Men’s Test Rankings,” the ICC said in a report on its website. “Saud Shakeel (753 ratings points) scored 84 in the first innings, climbing three Rankings spots to 8th on the batting list, moving above Steve Smith (746, 9th) and Rishabh Pant (739, 10th).”
Ali, with 761 points to his credit, broke into the top 10 by securing the number nine position. India’s Jasprit Bumrah with 908 points and Australia’s Pat Cummins with 841 points occupy the first and second position, respectively. 
“Other notable movers include Pakistan’s Sajid Khan (621), who climbed 18 places to No. 23 after his standout performance in Pakistan’s victory in the first Test,” the ICC said. 
Pakistan, who lead 1-0 in the two-match Test series, will next face the West Indies in Multan for the second Test on Jan. 25. Both teams are placed at the bottom of the World Test Championship after successive losses to other teams. 
Pakistan are expected to head into the second Test with both Khan and Ali in the playing XI. The South Asian team have been making spin-friendly tracks in Multan and other venues across the country ahead of Test series to capitalize on its home conditions. 
Pakistan beat England 2-1 in a three-match Test series at home, capitalizing again on the spin-friendly tracks. However, the South Asian team lost to South Africa 2-0 in an away Test series this month.