SBP urged to abolish cash dollar import restriction

KARACHI: Exchange companies have demanded the government and the central bank to abolish its decision to restrict the import of dollars up to 35 percent against the export of permissible foreign currencies, otherwise the rupee / dollar parity will touch 115 and above in the open market.

“The SBP decision of restriction up to 35 percent import of cash US dollar against the permissible export of foreign currencies and routing of 65 percent through banks hurt the market mechanism and pushed the rate of the dollar from Rs110.70 to Rs113,” said Zafar Paracha, secretary general of the Exchange Companies Association of Pakistan (ECAP) on Saturday.

“It will create problems for the exchange companies in maintaining demand and supply of the greenback.”

“The banks do not cooperate and takes minimum four days to settle the same,” he said.

Previously, the State Bank of Pakistan governor had accorded permission to the exchange companies to import cash US dollar to resolve the issue of unavailability of cash US dollar and also eliminate the difference between interbank and open markets.

The association has failed to understand the recent decision taken by the State Bank to impose a restriction of up to 35 percent import of cash US dollars, he added.

The rupee hovered at 111.50/111.80/dollar in the kerb market on Friday, the Exchange Companies Association of Pakistan said.