ISLAMABAD – Extension in the currency swap agreement between Pakistan andChina has been termed beneficial for the local economy facing multiplechallenges.

The rupee-yuan swap amount has been doubled from 10 billion yuan to 20billion yuan which will reduce the dependence of Pakistan on US dollar at atime when forex reserves and rupee are under pressure, a press release said.

The deal was signed five years ago but it didn’t work due to lack ofinterest of the part of the business community and banks but now thesituation has changed, Chairman of Coordination FPCCI Malik Sohail said.

He said now China is our biggest trading partner, bilateral trade isgrowing, CPEC has become a reality, therefore, doubling the swap size to351 billion Pakistani rupees is a good move.

Malik Sohail said Pakistan continues to distance itself from the US andgetting closer to China while the bilateral trade could jump to 13 billiondollars in which Pakistan would be importing items worth 11 billion dollars.

Now Pakistan would be able to finance imports from China is Yuan which willalso help stabilize rupee, he said, adding that further extension in thedeal should not be delayed.

He said Chinese companies working on CPEC and other projects would be ableto send back profits in Chinese currency which will benefit Pakistan’seconomy.

The tensions between US and China and the new moves of American Presidenthas forced many countries to reduce dependence on the dollar and conductinternational trade in local currencies.