New UAE rules trigger dirham shortage in Pakistan

KARACHI: The open market is experiencing a dearth of UAE dirhams (AED) as the Gulf state made it essential for Pakistani travellers to disclose 5,000 dirhams at the airport at the time of landing, foreign exchange dealers said.

The most recent development has caused Pakistan's currency market to fall short of the AED. The price of the US dollar in the kerb market has increased as a result of this as well. Due to a sudden shortage of US dollars in the open market, the price of the greenback increased in comparison to its interbank rate.

Exchange Companies Association of Pakistan (ECAP) President Malik Bostan, said that 21 flights from Pakistan land in Dubai each day, carrying a whole of 4,200 Pakistanis per day who require about 21 million dirhams every day.

“The dirham is no longer accessible in the open market whilst the fee has also gone up,” Bostan said, adding: “Those handy overseas currencies are exported to Dubai to convey back an equal amount of US dollars. Increased demand for the UAE’s currency has created a shortage of dollars.”

Bostan stated a new law of the Civil Aviation Authority (CAA) for all passengers to declare cash and jewellery has brought on this problem. He said most people from the Middle East arrive with money in riyals and dirhams. They also deliver money from their colleagues to directly hand it over to their households in Pakistan. Now, no Pakistani can take this risk.

The arrival of the foreign currencies in the open market has fallen about $3 million per day, he added. The rupee which had recovered to the level of 207 against the dollar in the open market during last week is now trading at 212. The local unit has also started to drop in the interbank market as well.