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Pakistan waiting for Saudi fund as USD jumps over Pak rupee

ISLAMABAD: The US dollar on Friday reached an all-time high against the rupee, soaring to Rs176 in the interbank market in intraday trading. In the open market, meanwhile, the dollar rose by Rs1.70 and was being traded at Rs178 around 12:30pm.

Pakistan is hopeful for a better situation in coming days as Saudi Arabia has assured to provide agreed funds in coming days.

Saudi Ambassador Nawaf Bin Said Al-Malki

Zafar Paracha, chairman of the Exchange Companies Association of Pakistan, told Dawn.com that the dollar had depreciated to Rs169.50 after Saudi Arabia revived financial support and oil supplies to Pakistan, however, “the statement from the finance adviser (Shaukat Tarin) in which he predicted further rise in the dollar’s value provided space to speculators and they manipulated the market.”

According to Paracha, the delay in the finalisation of the International Monetary Fund’s (IMF) loan programme was also one of the reasons for the dollar rise “because if this programme was approved, we would have received $1 billion immediately”.

He said only an intervention from the State Bank of Pakistan could contain the skyrocketing value of the greenback. Paracha also demanded action against banks allegedly involved in the dollar speculation.

Meanwhile, Mettis Global — a web-based financial data and analytics portal — quoted Asad Rizvi, the former treasury head at Chase Manhattan bank, as saying: “PKR that was holding up relatively well after the news of the Saudi deposit […] in hope of getting the IMF nod lost nearly 440 paisa in nine days due to delay.”

On October 27, the dollar had crossed the Rs175 mark to set a new record, with one currency dealer saying that “nobody knows where is the boundary of this devaluation of the local currency.”

Last week, Adviser to the Prime Minister on Finance and Revenue Shaukat Tarin had announced that an agreement with the IMF over the revival of the $6 billion Extended Fund Facility had been reached and a formal accord would be signed later in the week. But a formal agreement has yet to be announced.

Saudi funds

Saudi Arabia will soon disburse cash deposits to Pakistan under the pledged financial assistance after approval of the Royal Court and signing of a Memorandum of Understanding (MoU) in a few days, Saudi Ambassador Nawaf Bin Said Al-Malki said on Thursday.

“This will be soon InshaAllah. There will be the agreement from the Royal Court and the MoU will be signed in a few days for the payment, and also for the deferred oil payment [facility],” the Saudi envoy said in an exclusive interview to Shumaila Andleeb of APP, during his visit to the headquarters in Islamabad.

Saudi Arabia had recently announced to provide Pakistan $3 billion as a cash deposit with the State Bank to address its balance-of-payments crisis. Also, the Kingdom had pledged a one-year deferred payment facility for the import of oil, worth up to another $1.2 billion.

ISLAMABAD: Managing Director APP Mobashir Hasan presents a memento to Saudi Ambassador Nawaf Bin Said Al-Malki during his visit to the APP Headquarters.

Ambassador Al-Malki said the government of Saudi Arabia considered Pakistan as “a dear country” with a very deep and strong relationship.

He said Saudia Arabia always stood with Pakistan and extended support to it on multiple occasions, adding that the relationship with Pakistan was regardless of any government in power.

“Our connection is with the Pakistani flag and we consider it our brotherly country,” he said, adding that he saw a “very bright future of Pakistan”.

The Saudi ambassador mentioned the camaraderie between the Saudi Crown Prince Mohammed Bin Salman and Prime Minister Imran Khan and expressed confidence that the relationship would strengthen in the future.

In three years, the six visits of PM Imran Khan to the Kingdom reflect the level of relationship, he added.

The Saudi envoy said Pakistani people loved the Kingdom of Saudi Arabia from the core of their hearts and held in high esteem the Custodian of the holy mosques.

Asked about the scope of collaboration between the media of the two countries, he said the role of media was “very important in bringing the nations closer”.

Ambassador Al-Malki, who in a few months is completing eight years of his stay in Pakistan, said the people of the country were very friendly and deserved a lot of good in their lives.

From the JF-17 fighter aircraft to the thousands of factories in Faisalabad, he said, there were a lot of positive things to be proud of and thus shown to the world as the image of a ‘real Pakistan’.

He wished Pakistan the best of stability, progress, and prosperity.

Earlier, the Saudi ambassador in a meeting with Managing Director APP Mobashir Hasan discussed ways to strengthen cooperation, especially in terms of media and people-to-people contacts.