Currency traders trying to reconnect with Dubai

Published March 6, 2026
A file photo of US banknotes being counted.  — AFP/File
A file photo of US banknotes being counted. — AFP/File

KARACHI: Traders have been trying to revive trade links with Dubai, as the relationship was disrupted following the US-Israel attack on Iran, which turned Dubai into a war zone.

Traders said two flights were likely to depart from Karachi and Lahore for Dubai tonight, but were unable to identify who these people are or why they want to enter Dubai while the war is still ongoing.

Dubai is a global financial centre, while hundreds of Pakistani companies operate there to benefit from tax exemptions and other facilities not available in Pakistan.

“We have collected foreign currencies and a person is expected to fly to Dubai to buy dollars against these currencies,” said Zafar Paracha, General Secretary of the Exchange Companies Association of Pakistan (ECAP). Foreign currencies such as Saudi Riyal, UAE Dirham, and all currencies other than US dollar are collected and sent to Dubai to purchase dollars.

So far, a flight from Lahore was expected to depart at 3.30am for Dubai, and our representative carrying foreign currencies would travel on the same Emirates Airline flight,” said Mr Paracha.

The UAE is Pakistan’s second-largest trading partner. In FY25, the trade volume was $10.1bn. If the trade remains halted for a longer period, both countries will face significant losses.

“Foreign currencies other than the dollar have accumulated to $50 million. If we manage to send it to Dubai and bring it back in dollars, it means the trade relationship with that country has begun,” ECAP Chairman Malik Bostan said.

He said the inflow of remittances during Ramazan usually increases by 20 per cent. “The overseas workers in the Middle East were expected to reach Pakistan during this month but the war has stopped them, which means the foreign currencies used to come with them are not entering the market,” he said, adding that the open market during these days is dull; with no activity as both buyers and sellers have disappeared.

Foreign exchange reserves of the State Bank of Pakistan rose by $87 million to $16.300 billion during the week ending on Feb 27. The total liquid foreign reserves held by the country stood at $21.434bn, including $5.134bn held by commercial banks.

Published in Dawn, March 6th, 2026

Opinion

Editorial

In chains
Updated 25 May, 2026

In chains

THE question should never be about who is at the receiving end at any given point in time: an assault on an...
Climate shocks
25 May, 2026

Climate shocks

THE latest State Bank report documenting recurring climatic disasters in Pakistan during the period between 2000 and...
Justice deferred
25 May, 2026

Justice deferred

PAKISTAN’S courts are quick to remind the public that justice takes time. Increasingly, however, it is the conduct...
Some progress
Updated 24 May, 2026

Some progress

Pakistan deserves credit for helping preserve diplomatic space, but also must avoid appearing aligned with coercive pressure from any side.
Chinese market
24 May, 2026

Chinese market

PRIME Minister Shehbaz Sharif’s trip to China presents an opportunity to rebalance Pakistan’s economic...
Harvesting humans
24 May, 2026

Harvesting humans

ORGAN brokers have for too long preyed on desperation to rake it in. The odious trade — among the most harmful...