Economic growth

A stable currency is important to achieve real economic growth. The Pakistani rupee has depreciated about 45 percent during the last three and a half years since Imran Khan came into power in August 2018. The exchange rate of the rupee was Rs120 per US dollar in August 2018. Now, it is Rs175 per US dollar. This sharp depreciation is an economic disaster. Such a situation also leads to an abrupt stop in foreign investments. A country like ours cannot achieve real economic growth without foreign investments. Secondly, the rupee devaluation has resulted in rising inflation. The country imports a sizeable portion of edible items. The resultant increase in the prices of goods and services makes the life of ordinary people difficult. Theoretically, the rupee devaluation should result in increased demand for exports because our exports become cheaper for foreign buyers, but we don’t get any noticeable increase in our exports after the devaluation because we don’t have any significant exportable surplus.

The relevant authorities need to take a look into this situation and come up with a concrete financial plan to pull the country out of this economic mess.

Ejaz Ahmad Magoon

London, UK