The federal government is considering multiple proposals put forward by the Forex Association of Pakistan in order to increase the forex reserves of the country. As per details, the president of the Forex Association of Pakistan, Malik Bostan, has presented a number of proposals before the Senate Standing Committee on Finance and Revenue which is expected to provide $24 billion to the government over the next 24 months.
Stabilizing the Exchange Rate and Forex Reserves
Malik Bostan confirmed that after the Standing Committee of the Senate, the Standing Committee on Finance of the National Assembly also called the representatives of the exchange companies for a briefing next week where they will send their recommendations to the Prime Minister after reviewing the proposals of the association to stabilize the exchange rate and meet the needs of domestic foreign exchange.
Malik Bostan said that they had done this before in 1998, at that time the country’s foreign exchange reserves were at the lowest and most dangerous level of 400 million dollars, while economic sanctions were also imposed on the country due to the nuclear explosions; the suggestions had helped increase the foreign exchange reserves to ten billion dollars.
Government Eyes People’s Gold
In other news, the federal government is considering a proposal to borrow gold biscuits and bars from the people to increase foreign exchange reserves. As per the details, the commercial banks will issue a negotiable discounted instrument to the gold owner and pay an interest rate on the precious metal. The commercial bank will then deposit the gold with the SBP which can monetize it to increase the foreign exchange reserves.
Also read: SBP-held Forex Reserves Up $280 Million; Now Stands at $4.6 Billion
