Rizwan Ghani
WHILE launching Roshan Pakistan Digital Account, PM defended dual nationals. He should look at UK and London. Almost all senior civil servants have resigned. London is dirty money laundering centre. Brexit is being executed despite reports that it will undermine Kingdom’s unity, destroy economy and increase unemployment. The OECD 44 nation education data shows that UK and US are worst off in education so PM is wrong about using overseas as “resource pool” (2018 PISA report). They have no proven track record which May used to reject nomination of NSA. Pakistan needs will to overcome national challenges but with dual nationals in critical areas somehow country is bleeding. RPDA is case in point. The government is saying that SBP has given this scheme to give it credibility and keep itself off the hook. But it is an illegal scheme because it shows that SBP is exercising two powers which is corruption. If as a financial institution State Bank has promoted commercial banks then it cannot act as central bank control monetary policy because it is controlling amount of currency and setting exchange rate. We have seen in the recent past how high interest rate cost national economy Rs1.5tn loss. A case is already pending in SC. SBP should be returned under state as system of check and balance because it cannot control monetary policy and promote commercial banks simultaneously.
One of the aims of this scheme was to use overseas Pakistanis foreign currency accounts so that like world trade oil in NYCE a certain amount of foreign currency will be always there in our banking system allowing Pakistan is to have “floating” foreign currency reserve in exchange for an online digital account. Then only government banks, National Saving Centres and State Life should have been allowed to open these accounts so that state has direct control of foreign currency reserve. The corruption in this program in its current form it will bring foreign currency in the country but it will go to the private banks instead of building FC reserve under state control. The channelling of foreign currency to private banks is a triple crime. Government will be forced to borrow foreign currency from private banks to bolster its foreign reserves which should have come to state reserves in first place via public setups. Then government is the major borrower from private banks. SBP has helped private banks to make double profit from the state; first in the form of exchange rate and then interest rate on the loan for the government. Remember SBP controls both exchange rates and interest rates. Keeping in view the two-year template of SBP, billions will be raked in with the manipulation of exchange rate and interest rate in future.
Then videos praising RPDA are being shown on social media. Pakistani embassies are being used as part of strategy to influence overseas Pakistan to make foreign currency deposits in private banks. Embassies are false sense of security because it is common knowledge that public banks are always safer. The overseas Pakistanis are opening accounts, making deposits in foreign currency to help Pakistan. They should be helped to use public banks for mutual benefit instead of being pawned to individually owned private banks without any benefit to state or the long term deposits because of low interest rates and But such public sector setups are blocked due to collusion between finance setup and private banks. NSC and SL are barred from accepting foreign remittances. In 2018, NSC had Rs458bn savings deposit (PBS). Governments used to use these public savings to build mega public projects. It saved the government from taking high interest loans from private banks or international market. But this government reduced NSC interest rates at the outset. It is due to such anti-state and planned policies. Pakistan has been pushed under Rs13000bn debt in the last two years. It is 1/3rd of total national debt accumulated in the last 70 years.
According to Global Financial Integrity estimates $1.1tn a year flow illegally out of poorer nations. It is stolen through subsidies, tax evasions and money transfer. RPDA is a two-way money transfer program in which Overseas Pakistanis are the glittering face of the package behind which is the mega crime of legalization of looted money transfer aboard. It explains opposition’s standoff on FATF because it wants to bring looted wealth back to the country while rulers want to take it out and SBP wants to benefit private banks. No wonder London is global money laundering centre and dual nationals are masters of our economy and PM’s faith in OP is icing on cake to sell the project. Finally, it is credibility that wins the day. After 2007-8 financial crises, WSJ wrote that we need morally upright CEOs. Pakistan can overcome its financial crisis without any foreign help. The first 30 years of our independence show that we had best constitution, bureaucracy and public banking system. We respect dual nationals but we don’t need any outside help. We should follow orders of Quaid-i-Azam and keep SBP under government control and use public setups for foreign remittance. There is no dearth of honest people who can make Pakistan strong again in post Covid-19 world.
—The writer is senior political analyst based in Islamabad.
