ISLAMABAD - Terming the rupee deprecation against US dollar ‘the most sensitive issue’, State Bank of Pakistan (SBP) Governor Yaseen Anwar on Tuesday refused to comment on this issue by saying that rupee could further lose its value if he comment on it.
“Governor central bank is not answerable for currency value change throughout the world therefore I will not make any comment on rupee deprecation,” Yaseen Anwar told Senate Standing Committee on Finance Revenue and Economic Affairs. Governor SBP said that dollar value had increased to Rs 110 in inter-bank just for two hours on last Thursday, which forced the central bank to intervene that has improved the rupee situation. However, he did not disclose the steps taken by the central bank that helped in brining dollar value to Rs 105.5 on Thursday. “I cannot explain the measures opted by SBP, as the matter is sensitive”, Yaseen Anwar replied to the question asked by Senators.
He termed the losing rupee value deprecation not devaluation. Governor SBP informed that market sentiments have played role in rupee depreciation. He made it clear that there was no IMF condition for rupee deprecation and said that central bank purchased $125 million from inter-bank in August, which had nothing to do with decrease in rupee value. Similarly, he assured that there would be no compromise on dependence of central bank with IMF.
He further said that currency is also depreciated in other countries like India, South Africa, Turkey and Indonesia by double digits figures while in Pakistan rupee depreciated by ‘only 5-6 percent’. “Following the IMF programme, other financial institutions like Word Bank and Asian Development Bank have opened their doors for Pakistan”, he informed. Talking about the money laundering, the Governor SBP said that he is personally monitoring it and 90 percent of transactions are made through banking sources. SBP is working to control the money laundering, he added. He further informed that government had repaid $6.6 billion to different financial institutions including 3 billion dollars to IMF during last financial year 2012-2013 through our own reserves. Economists proved wrong as they were projecting that Pakistan would default on international payments.
Yaseen Anwar said that government would take action against those who find guilty in rupee speculation, as it was decided in a meeting with representatives of banks on Monday.
Secretary Finance Dr Waqar Masud informed the committee that Pakistan is expecting to receive $ 1.2 billion from United States under coalition support fund (CSF) during the ongoing financial year 2013-2014 wherein $325 billion would be received by October 15. He showed optimism that government would receive $ 800 million from Etisalat against Privatization of Pakistan Telecommunication Company Limited by resolving the pending property disputes during the current fiscal year.
Talking about the auction of 3G licenses, Secretary Finance said that government has appointed a Chairman PTA and formed a committee in this regard. He further informed that government’s borrowing from central bank stood at Rs 448 billion on September 26, which enhanced to higher side of Rs 779 billion on September 16.
On the issue of increase in petroleum products prices, Secretary Finance informed the committee that government has increased the oil prices following hike in international market. However, he said, “Government has not passed on the full increase, as it will bear Rs 2.1 billion subsidy by providing petrol and diesel prices at lesser prices than the calculated prices”. Dr Waqar said that Council of Common Interestd had approved the Energy Policy allowing increasing power tariff, which was not enhanced in last 16 to 18 months and government provided huge subsidy on it, he added.
Secretary Finance informed that there are strict laws to control the money laundering, however certain amendments would have to made in anti terrorism act in this regard.
Earlier, Senators showed concerns over the increase in petroleum products prices and said that India is also purchasing oil from international market but it has reduced the POL products rates. The committee members noted that Federal Investigation Agency (FIA) took action against Khanani and Kalia three years back that stabilized the rupee value during last three years. The committee members were of the view that SBP should have intervened in interbank earlier to control the rupee deprecation.
Speaking on the occasion, Senator Kalsoom Perveen said that Governor SBP is aware of reasons behind rupee deprecation against US dollar while public representatives are deprived from knowing the reasons. Senator Sughra Imam said that government should give priority to hydel power generation instead of producing electricity on imported fuel. She said that government should allocate funds for the construction of dams.
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