KARACHI – Chairman of National Business Group of FPCCI, President Pakistan Businessmen and Intellectuals Forum and All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain on Monday said forex reserves have hit an all-time high of 13.5 billion dollars during the tenure of current government due to the prudent policies of the central bank.
The forex reserves can jump to 14 billion dollars by the end of December while the efforts to continue strengthening foreign exchange reserves should continue, he said.
Mian Zahid Hussain said that an agreement with the IMF, issuing Euro and Sukuk bonds and improved exports are central to continue strengthening forex reserves.
Talking to the business community, the veteran business leader said that the current situation is satisfactory as the textile sector is working at full capacity but the second wave of coronavirus can jeopardise everything.
The State Bank needs to bring the foreign exchange held by masses into the banking system through incentives so that the foreign exchange reserves could be pushed up to $20 billion by June 2021.
He noted that the current account is in surplus while a 300 million dollar loan from the ADB has also strengthened reserves but the IMF deal which was supposed to be signed in February should not be delayed.
The agreement with the IMF will require doing away with some corporate relaxations and a hike on power tariff. It will also need steps to control circular debt but negotiations with the IPPs are in a deadlock mode while the government cannot do much due to agreements signed with them.
The pace of circular debt should be slowed down otherwise it will continue to hit the economy and may become a matter of concern in negotiations with the lender, he warned.
