The Federation of Pakistan Chambers of Commerce Industry’s Businessmen Panel has warned the government of incessant surge in trade deficit, widened by 106.4% during the first half of the current fiscal year 2021-22, keeping the local currency under pressure, which is back to its depreciating trend against the US dollar, after remaining stable for a couple of days.
The BMP chairman Mian Anjum Nisar urged the government to control volatility of rupee against the US dollar, which is not possible without keeping a check on soaring trade deficit, putting the industrial revival and economic growth at risk.
The trade deficit during the first six months of July-Dec has reached $25.478 billion compared to $12.34 billion registered during the same period of 2020-21, he said and added that last week, the rupee had closed at its all-time record low of 178.24 against the US dollar before appreciating the following two days to end the year at 176.51. He was of the view that State Bank of Pakistan will have to remain vigilant in this regard.
Besides this, the SBP and the government also need to intervene and come up with policy reforms to control depreciation of rupee with a view to address the issue of trade deficit.
FPCCI’s Businessmen Panel Chairman said that apart from increasing exports and keeping a check on imports the government will have to take administrative measures, as a large demand of cash dollars are seen in the market.
