The Pakistani rupee on Tuesday recorded a minor gain against the US dollar in the interbank market, bringing it down below Rs281. As per the information obtained from forex traders, the local currency went up by 35 paisas and was being traded at Rs280.93. On Monday, the Pakistani rupee had registered a marginal score against the US dollar to settle for the day at Rs281.28. In a related development, domestic borrowing rose to 40.955 trillion rupees by end November 2023 as per data uploaded by the State Bank of Pakistan on its website - and whatever comparison one may be tempted to cite to make this amount look remotely palatable the following comparisons merit the attention of the stakeholders on an emergent basis.

The comparable figure for July-November 2022 was 32.985 trillion rupees or a rise of 24 percent this year against the same period of last year in spite of the fact that in 2022 Ishaq Dar’s violations of the agreement with the International Monetary Fund (IMF) under the then ongoing Extended Fund Facility programme led to a cessation of all external budgeted inflows while in the current year subsequent to the staff-level agreement (SLA) on the first review of the Stand-By Arrangement foreign inflows from bilaterals/multilaterals are on track though the 6.12 billion dollars budgeted under foreign commercial bank borrowing and issuance of debt equity (sukuk/Eurobonds) remains suspended as no rating agency has upgraded the country’s rating after the SLA;

(ii) domestic debt rose from 31.085 trillion rupees in June 2022 to 38.809 trillion rupees in June 2023 - a rise of 25 percent and the responsibility for this highly irresponsible policy rests with former Finance Minister Ishaq Dar who not only raised the current expenditure by 21 percent from what was budgeted in spite of cessation of all external assistance at the time but also raised domestic debt servicing cost to the country by a whopping 39.4 percent from what was budgeted.

Credit: Independent News Pakistan (INP)