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Pakistan has the region’s lowest foreign exchange reserves: SBP Governor

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Governor Jameel Ahmed expressed before the Senate Standing Committee on Finance that inflation is anticipated to increase in the last quarter of the current fiscal year and the initial quarter of the subsequent year. He emphasized that Pakistan is required to fulfill $4.5 billion in external debt obligations by July 2025.

Ahmed affirmed that a UAE safe deposit will be settled as planned this month. He stated that, for the first time in two decades, the current account exhibited a surplus as of November in the current fiscal year.

The decrease in the interest rate has diminished debt servicing expenses from PKR 9.8 trillion to PKR 8.3 trillion. During the conference, it was disclosed that Pakistani banks incur approximately $800 million each year for ATM card and internet transaction services. The committee proposed the implementation of a local payment card to alleviate this load.

The committee chairman said that if banks do not cease dollar payments for local services, legislative action will be contemplated. He voiced apprehension regarding money shortages amidst the expenditure of billions on card services.

Although the PayPak card was introduced in 2016, the initiative did not achieve significant popularity. Ahmed asserted that remittances may attain $35 billion this fiscal year, exceeding the budgetary objective by $5 billion. He observed that the central bank presently possesses $11.7 billion in reserves and engages in market intervention by purchasing excess dollars or selling when required.

The State Bank anticipates a profit of PKR 3.4 trillion for this fiscal year, with fiscal capacity in debt servicing potentially reaching PKR 1.5 trillion, hence facilitating the attainment of budgetary objectives.

On December 17, 2024, the SBP governor revealed that Pakistan repaid a debt of two billion dollars during the preceding two years.

During a television chat show, the SBP governor indicated that foreign exchange reserves have risen.

He indicated that the current account will exhibit a surplus of 700 million dollars in November.

The governor of the central bank stated that the State Bank of Pakistan has acquired dollars from the interbank market.

He also stated that remittances from abroad will exceed 35 billion US dollars in the current financial year.

The governor’s comments followed the State Bank of Pakistan’s (SBP) reduction of the policy rate by 200 basis points in its monetary policy on Monday.

The State Bank of Pakistan (SBP) announced that the Monetary Policy Committee (MPC) has resolved to reduce the policy rate by 200 basis points to 13 percent, effective December 17, 2024.

It stated that inflation decreased to 4.9 percent year-over-year in November 2024, consistent with the MPC’s projections.

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In January 2025, RDA inflows reach 9.564 billion USD.

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Remittances under the Roshan Digital Account (RDA) increased from US $9.342 billion at the end of 2024 to US $9.564 billion by the end of January 2025.

The most recent data issued by the State Bank of Pakistan (SBP) revealed that remittance inflows in January totaled US$222 million, compared to US$203 million in December and US$186 million in November 2024.

Millions of Non-Resident Pakistanis (NRPs), including those who own a Non-Resident Pakistan Origin Card (POC), desire to engage in banking, payment, and investing activities in Pakistan using these accounts, which offer cutting-edge banking options.

Nearly 778,697 accounts were registered under the scheme by the end of January 2025, according to the data.

By the end of January, foreign-born Pakistanis had contributed US $59 million to Roshan Equity Investment, US $479 million to Naya Pakistan Certificates, and US $799 to Naya Pakistan Islamic Certificates.

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FBR lowers Karachi’s built-up structure property valuation rates

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A year-by-year breakdown of the depreciation value of residential and commercial built-up properties is included in the updated property valuation rates for Karachi that the FBR has announced.

The notification said that built-up structural values on residential property will be gradually reduced.

A residential home’s built-up structure, which is five to ten years old, will lose five percent of its worth.

In a similar vein, constructions between the ages of 10 and 15 will lose 7.5% of their value, while those between the ages of 15 and 25 would lose 10%. Built-up structures that are more than 25 years old will be valued similarly to an open plot.

Furthermore, age will also be used to lower the valuation of built-up properties, such as apartments and flats.

Structures that are five to ten years old will depreciate by ten percent, while those that are ten to twenty years old will depreciate by twenty percent. A 30% depreciation will be applied to properties that are 20 to 30 years old, while a 50% reduction will be applied to those that are above 30 years old.

In terms of commercial built-up properties, buildings that are 10 to 15 years old will lose 5% of their value, while those that are 15 to 25 years old will lose 8%. The value of properties that are more than 25 years old will drop by 10%.

In contrast, there would be a 15% boost in the value of commercial properties in the Defence Housing Authority (DHA) that face any Khayaban.

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Remittances Increase 25.2% in January 2025: $3.0 Billion Inflow

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Remittances from Pakistani workers totalled US$3.0 billion in January 2025, representing a 25.2% increase from the previous year.

The cumulative remittances for July through January of FY25 were 20.8 billion dollars, up 31.7 percent from 15.8 billion dollars during the same period in FY24.

In January 2025, the United States of America contributed 298.5 million dollars, the United Kingdom contributed 443.6 million dollars, the United Arab Emirates contributed 621.7 million dollars, and Saudi Arabia contributed 728.3 million dollars.

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