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ISLAMABAD: Members of the Senate Standing Committee on Finance had a divided opinion on Wednesday about the central bank’s decision to depreciate the rupee against the dollar on July 5.
The committee received an in-camera briefing by the senior management of the State Bank of Pakistan (SBP) about the recent rupee depreciation.
Sources said some senators considered the SBP’s decision justified while others believed otherwise.
Members belonging to the ruling party said then acting SBP governor Riaz Riazuddin owned the move in a statement, which was inappropriate. He should have consulted the government beforehand, they said.
On the other hand, senators belonging to the opposition said the SBP was autonomous, adding that the subsequent intervention by then finance minister Ishaq Dar was uncalled for.
Committee Chairman Saleem Mandviwalla and Saud Majeed of the PML-N had a short interaction with journalists after the in-camera briefing. They said the committee members expressed concerns about the issue.
Mr Majeed stated the SBP’s decision was wrong. It was subsequently proven as such by the correction in the currency market. The committee chairman said the decision to devalue the currency was right.
Meanwhile, sources said Mr Riazuddin told the committee that the drop of 3.1pc in the value of the rupee in the interbank market was a targeted move.
Mr Riazuddin told the committee that his decision was appropriate.
The market corrected itself the next day as private citizens holding the dollar poured foreign exchange into the market, he added.
SBP Governor Tariq Bajwa told journalists that an enquiry report has been finalised, but refrained from answering further questions in this regard.
He added that the in-camera briefing was held in view of the sensitivity of the matter.
Representatives of the Federal Board of Revenue told the committee the board’s collection in the last fiscal year had a shortfall of Rs259bn as total receipts were Rs3.36 trillion against the target of Rs3.62tr.
Published in Dawn, August 3rd, 2017
