PESHAWAR, Oct 30: The newly introduced afghani has failed to attract the local currency market owing to uncertain political situation inside Afghanistan, currency dealers in Peshawar’s main money exchange market said.

Afghan currency dealers at Chowk Yadgar maintain that they do not have much faith in the new Afghan currency due to bad law and order situation inside Afghanistan and the decreasing value of the new afghani against US dollar.

The new Afghan currency — printed in Germany — was introduced on Oct 7, while the government of Afghanistan has asked the people to return the old afghani before Eid-ul-Fitr, in the first week of December.

The new Afghan notes are in denomination of 1, 5, 10, 20, 50, 100, 500 and 1000.

“We continue to trade in the old Afghan currency, because we don’t know the exact value of the new afghani,” a currency dealer, Mohsin Khan, told Dawn here on Tuesday.

The main reason for the continued interest of the dealers in the old afghani was the decline in the value of the new Afghan currency, he said while pointing out that when the new was introduced the Afghan government had fixed the value of 50 afghanis against one US dollar. “But today the rate is 58 afghani to a dollar,” he informed.

Another afghani dealer, Abdul Qadir, said that the local currency market never exchanged the old Afghan currency in US dollars. “We had decided to exchange the new currency with Pakistani rupees,” he added.

When the Afghanistan government introduced the new afghani, the rate of an afghani was Rs1.47, but now it was equal to Pakistani rupee.

“The currency dealers have adopted the wait-and-see policy and avoid to trade in the new Afghan currency, until the old afghani is taken off the shelf. By that time we hope the actual value of the new currency will have been determined,” he opined.

“The Afghan people are happy over the Karzai’s government initiative to replace old Afghan currency, but they continue to trust the old afghani and do not deal in the new currency,” Maqsad Khan, another currency dealer, said.

“If the law and order situation improves in Afghanistan the value of new afghani will also strengthen, otherwise it will come to the same value of the old Afghan currency,” he opined.

Maqsad Khan said that he felt satisfied with the introduction of new Afghani as it was easy to carry in pockets due to its high value against the stacks of old notes. “Despite this advantage it has failed to convince the currency dealers to get them replaced with the new high-valued Afghani,” he added.

Bidding in old afghani is also the major reason to attract the local currency market, dealers at the market said. Most transactions are based on speculations in Afghanistan where the daily-changing political or military situation plays a key role in determining the value of the Afghan currency. Rumours play a key role, one dealer said.

“We still have about a month-and-a-half to play in the old afghani. Its a gamble, sometimes we win, sometimes we lose,” the dealer said.

But the determination of the value of the new Afghan currency by the National Bank of Afghanistan would not leave much room for the dealers to speculate and make money, said Mohammad Israr while holding a sack of old afghani.

Few days back Afghanistan finance chief had asked the Afghan currency dealers to start bidding in the new afghani to attract the Afghan people to replace the old currency, he maintained.

He lamented that the local currency dealers were sending old afghani to Afghan banks in Jalalabad as there was no formal contract between the Afghanistan government and the State Bank of Pakistan.

He feared that the government after replacing the old afghani with the new one might again devalue the currency against US dollar. “We have lost enough. Nobody is willing to take further losses,” he added.