LAHORE: The Lahore Chamber of Commerce & Industry (LCCI) has urged theState Bank of Pakistan to intervene for controlling depreciation of thelocal currency.
“Inter-bank US dollar exchange rate is on the rise. The SBP shouldintervene for averting economic crisis. Rupee devaluation would be the laststraw that breaks the camel’s back”, LCCI president Mian Nauman Kabir saidin a statement. He said that rupee devaluation would lead to new wave ofinflation and halt economic growth.
“US dollar rate against rupee was Rs4.76 in 60s, Rs59.30 in 2005 andtouched the highest level during the current financial year. Soaring dollarprice led to trade deficit, import costs, hike in POL prices etc”, MianNauman Kabir said.
He said that the recent surge in the prices of the greenback would jack-upthe input cost that would hit the export-oriented industries hard. He saidthat the SBP should ascertain the factors weakening the value of rupee andcheck the possibilities of undue speculations and malpractices in theoperation of foreign exchange markets. “This will help stabilise rupee andrestore the confidence of the business community,” he said.
He said that an unchecked increase in the dollar rates was multiplying thecost of doing business and badly affecting the industrial, manufacturingand agriculture sectors as Pakistan had to import fertilisers, food items,oil, machinery and industrial raw material.
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He said that the government should take immediate measures to arrestfurther devaluation of rupee to avoid more damaging consequences for theeconomy. He said though the weaker rupee benefited the exporters by givingthem more rupees per dollar, but the benefit was neutralised by the costlyimported inputs of manufacturing sector including textiles thus eroding thefinancial advantage.
The LCCI president said that high cost of doing business and heavygovernment borrowing was mother of all economic ills. He said that if thegreenback continued its upward flight, it would certainly inflate importbill besides lowering the competitiveness of Pakistan’s business andindustry. Therefore, the government should intervene and stop the dangeroustrend, he maintained.
