ISLAMABAD: On the day when the US dollar touched the highest-ever level against the Pakistani rupee, Prime Minister Imran Khan on Friday urged the nation not to worry over devaluation.

“We can devalue the US dollar against the rupee by increasing our exports and investments,” the prime minister said, presenting a rosy picture while addressing the guests of the inauguration ceremony of the Chinese car plant JW Forland at the Prime Minister’s House.

“My phone has been ringing since the morning that the dollar has increased against the rupee, but don’t worry,” the prime minister added. He explained that one of the reasons behind the devaluation of rupee was an unbridled current account deficit. Further, he expressed the hope that foreign remittances would increase due to incentives being offered to overseas Pakistanis and this would reduce the country’s foreign-debt burden.

Blames devaluation on current account deficit

Lauding the establishment of the vehicle manufacturing plant, the prime minister said that $900 million was being invested in the facility, which he said would become the first car manufacturing plant in the country and generate thousands of jobs. According to PM Khan, the plant would initially employ 5,000 Pakistanis, later increasing to 45,000. He added that the government had asked China to transfer technology so that Pakistan could further develop its industries.

“Training institutes will be established to train technicians in order to produce specialised Pakistani labour,” he said.

Power sector

The prime minister also chaired a meeting to discuss issues related to the power sector, especially the progress made so far towards the countrywide crackdown against power theft and the way forward to curtail losses in the power sector.

The meeting was informed that the power division, in coordination with provincial task forces, was actively carrying forward the campaign against power theft/pilferage in all the provinces. A gang has been busted in the Lahore and Faisalabad region that was involved in facilitating power pilferage by tampering with electricity meters through software. The meeting also discussed in detail the issue of power theft and low recoveries in the province of Khyber Pakhtunkhwa.

The prime minister was informed that out of the total losses of the province, major losses were being incurred in the Peshawar region.

Expressing concern over the quantum of power theft, Prime Minister Khan said that it was unacceptable that those who were regularly paying their dues had to face the inconvenience of load-shedding because of theft. He directed the chief minister of Khyber Pakhtunkhwa and the minister concerned to hold a press conference to highlight the issue before the public.

During the meeting, it was decided to expedite the installation of electricity meters in the areas where electricity was being used through direct (kunda) connections.

Money laundering

In a separate meeting, the prime minister directed that new legislation be finalised within a week to effectively deal with offences related to money laundering and to further strengthen the existing laws to effectively check hawala-hundi and other illegal/corrupt practices.

Prime Minister Khan also approved a package to further incentivise remittance through legal channels.

The meeting was attended by Finance Minister Asad Umar, Attorney General Anwar Mansoor Khan, sundry federal secretaries, the director-general of the Federal Investigation Agency, the chairman of the National Database Registration Authority, the deputy governor of the State Bank of Pakistan (SBP), and other senior officials.

It was decided during the meeting that the SBP, being the regulatory authority of the banking sector, would take action against elements that were involved in facilitating the opening and operation of fake bank accounts. The prime minister also tasked the secretary finance with submitting recommendations for regulating trade under the Pak-Afghan Transit Trade Agreement.

During the meeting, it was decided that necessary amendments would be introduced in laws including the Anti-Money Laundering Act 2010 to strengthen them. The interior secretary informed the meeting that task forces, at the national as well as provincial levels, had been constituted with an aim to identify legislative and administrative constraints in effective anti-money laundering activities.

He also identified various other actions, including making the Islamabad International Airport a ‘model airport’ with regards to inter-agency coordination, and the installation of truck scanners at Torkham to check money laundering, smuggling and other illegal practices.

In the same meeting Prime Minister Khan approved a package for the enhancement of incentives for remittances through legal channels.

It was decided to increase airtime to Rs2 against each US dollar received through M Wallet. It was also decided that banks/exchange companies would be reimbursed Re1 per US dollar as marketing expenses and promotional activities on remittances exceeding 15 per cent in the financial year 2019, as compared to 2018.

The budgetary impact of the incentive package has been estimated at around Rs2.3 billion.

Published in Dawn, December 1st, 2018

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