Shahbaz Sharif is right in a point of view devaluing PKR from 130 to 155-168 had no impact on Export.

[Hyde]

Under Shaukut Tareen dollar has gone up from Rs 153 to Rs 157. Just saying.

and not to 200

The first point is just an article. Even in 2018 that figure was laughable than in the next 3-5 years our energy consumption would double. That was never going to happen.
..


The argument that was used at that time was flawed because the cost of thar coal was calculated based on limited production at that time just to produce a few 100 MW of electricity not what the cost will be if we install thousands of MW, besides the internarional price of coal was low at that time ( we have debated this topic so much on this forum thar coal vs imported coal even taking into account the mmbtu factor). The main point in regard to thar coal was ECONOMY OF SCALE.

Another factor is, thar coal is of very low quality

 

[VCheng]

and not to 200

The only thing that stopped that milestone was PMIK's decision change to go to IMF. Exiting the current program prematurely will return that risk.

Another factor is, thar coal is of very low quality

And yet it does offer the advantage of being a domestic resource, and hence free from international price fluctuations.

 

[Hareeb]

PTI supporters blindfoldly follow their political affiliation, even if the GoP commits a mistake. You don't need a rocket science or an eminent economist to figure out that the huge devaluation of PKR was a wrong decision. It didn't enhance the exports at all.

The most pressing issue here is the re-brand of name 'Pakistan', which is tarnished badly because of terrorism and extremism.

In the order of merit next is being competitive and innovative. Followed by market access.

Someone doesn't have to be a PTI supporter to go along with an opinion that SS is a white-collar criminal.

As for as devaluation is concerned, market forces of supply and demand should purely determine floating exchange with no government intervention.

And it was a right decision with all it's effecfs on the economy. Data shows govt. kitty had total reserves equal to just 1 month worth of imports. If government had to intervene and artifically maintain currency exchange rate, SBP would have to increase dollar supply in the market; this injection may have maintain exchange rate for sometime but eventually, the rupee had to devalue, or else the country could have got bankcrupt, and the worse could have dollarization of the economy.

For sure, the name "Pakistan" needs rebranding but along extermism and terrorism, the country needs to be parted ways from the word "corruption" too, as some have written books on the loot of our leaders; some are called Mr. 10% and others are known as penthouse pirates.

 

[Patriot forever]

China kept its currency under valued, but than it achieved its objective of boosting exports. If it didn't happen in our case then obviously we can't say it was a right decision. The devaluation of Rupee was done to meet the condition of IMF.

PTI has been beating the drums that PMLn has left the economy in shambles because of a staggering trade deficit of USD 30 billion. Here we are after 35% devalution more or less the similar amount of deficit is expected. Means we back to square one but with a Rupee with lesser value of 35% against USD.

Nah bro there is no way we will register that much deficit. It will be around 1-2% GDP this upcoming FY, 6-7b at max the way i see it. It will be front loaded in initial months if Terf roll out goes as planned, the other thing is commodity supercycle.

If this policy of market based currency is continue our exports will increase in the coming years once the capacity enhancement completes. We need to sort out the power sector.

 

[Patriot forever]

and not to 200

Another factor is, thar coal is of very low quality

Yes bro it was taken into considerarion as i mentioned. (mmbtu parity factor)

Coal at our end is basically free, just the extraction and transport cost. ( Coal does not require much sophitication as copper or iron, it is used in raw form without much processing). THE MORE YOU EXTRACT AND THE BIGGER THE SCALE OF OPERATION THE CHEAPER THE PRODUCT AND VICE VERSA.

There is no comparison of labour cost or even inland transport cost from where we are importing coal.

Not to mention the forex savings and stability in price, unlike imported coal which is at $115/ton.

 

[PradoTLC]

Shahbaz Sharif is right in a point of view devaluing PKR from 130 to 155-168 had no impact on Export.

In my point of view we had no advantage for export in Pakistan. Only thing market base currency has bought is inflation and things for inflated.

FDI dropped massively as well, indirect tax increased as well and Asad Umar compromised CPEC contract sharing with IMF in 2019.

In my point of view, Asad Umar and Hafeez Shiek badly negotiated IMF program in the history Pakistan it has delayed for more than year now. Now again delayed to September just because it was very badly negotiated and Government has no experience how to deal with International lenders.

You are right when sharif ruled Pakistan was a Switzerland … now under PTI it has become like india

thank you for the enlightenment

I guess the problem with this argument is that Asad Umar had no option, we were short of dollar and to keep the exchange rate stable, we needed to inject more dollars in the market. You can argue that the way rupee was made to fall, was disastrous, I mean a lot of economists including out current FM has said that too, but to say devaluation was overall avoidable, is wrong.

Miftah Ismail, who I consider to be a competent economist, realised the blunder Dar had committed and the devaluation process started during his time as the Finance Minister. There can be arguments about how it was handled, but it was inevitable.

Correct the fundamentals dictated a devaluation… how it was handled is an academic debate.

Either way i am happy to see Shakut Tareen in charge whom I consider as good as shakut aziz. He is top notch.

 

[crankthatskunk]

Shahbaz Sharif is right in a point of view devaluing PKR from 130 to 155-168 had no impact on Export.

In my point of view we had no advantage for export in Pakistan. Only thing market base currency has bought is inflation and things for inflated.

FDI dropped massively as well, indirect tax increased as well and Asad Umar compromised CPEC contract sharing with IMF in 2019.

In my point of view, Asad Umar and Hafeez Shiek badly negotiated IMF program in the history Pakistan it has delayed for more than year now. Now again delayed to September just because it was very badly negotiated and Government has no experience how to deal with International lenders.

Ok my friend how much you know about the "Economics"!!!

Was Rupee Devalued!!
Nope it wasn't. It was left to the market forces to decide the true value of the Rupees.

Lets start with the top figure, how Rupee was valued at 104-108 to a 1 US $!!
What factors were holding the rupee firm!!
Care to explain to us.

 

[Path-Finder]

THE THEORY THAT I HAVE A SEEN A LOT PEDDLE AROUND IS THERE WERE NO OTHER OPTION IS ENTIRELY FALSE, WHEN PLMN BURNED AROUND 4-5B JUST IN THEIR LAST YEAR MANIPULATING CURRENCY.

munchi dar depleted Pakistan forex by throwing 21 billion dollars to artificially float the rupee rate.

 

[Old School]

When PKR is depreciated , the import costs become expensive and manufacturing becomes costlier. As a result, price hikes of essentials take a toll on the general public. We are overwhelmingly an import county. There is no point giving few politically influencial exporters incentives at the costs of of majority as well as breaking the economic fundamentals. One doesn't need to be a economist to understand this simple fact. Let us make the PKR a true floating currency and market will decide it's true value without politicians and bureaucracy babysitting it..

 

[Patriot forever]

Ok my friend how much you know about the "Economics"!!!

Was Rupee Devalued!!
Nope it wasn't. It was left to the market forces to decide the true value of the Rupees.

Lets start with the top figure, how Rupee was valued at 104-108 to a 1 US $!!
What factors were holding the rupee firm!!
Care to explain to us.

Finally someone put it in the right words.

Basically all that was happening was import was being subsidized by the governemnt at the other end by using forex.
People just has excess to cheap subsidized imports. It is needless to explain its impact on a dollar starved country.

Party at the expense of Pakistans stability.

 

[Path-Finder]

https://twitter.com/x/status/1227389749188583424

 

[Patriot forever]

When PKR is depreciated , the import costs become expensive and manufacturing becomes costlier. As a result, price hikes of essentials take a toll on the general public. We are overwhelmingly an import county. There is no point giving few politically influencial exporters incentives at the costs of of majority as well as breaking the economic fundamentals. One doesn't need to be a economist to understand this simple fact. Let us make the PKR a true floating currency and market will decide it's true value.

We need to cut tariffs on import of raw materials which this governemnt has done in this budget and make your power sector more efficient. Taking foreign loans to artificially keep the country running and subsidizing imports is no solution (cant do that forever or else we will end up like lebanon).

 

[BATMAN]

I actually disagree with your point of view. We only have a few items to export (textiles, IT, and low-cost products such as fans and small electric appliances), but we have a population of 200 million people who can consume a lot of products if given the opportunity, so we always make it difficult for our importers to ensure that the gap between import and export does not widen to the point where it becomes unsustainable.

Importing raw materials hurts our little industrial sector, and I honestly feel that we must promote our industrial sector regardless of the circumstances.

I not only disagree to your PoV but i must unwind the twist of misguidance it carries.

Pakistan have NO future without state's participation in protecting and promoting local industry, as priority.

Along side infrastructure development, Facilitating import of raw material for manufacturing industry is fundamental step towards a solid growth.
Founding industrial based economy shall not be seen merely as trade and commerce. It's like seeding a plant, who's roots and fruits cannot be approximated.
Industrial future must be inherited in state policy, which no political /religious motive is able to alter. In fact every move to import or promote foreign made, must be dealt with tough strife.

Unfortunately, what's happening on ground is exact opposite and by now Pakistanis have seen results of policies of riyasat e madina in reality is riyasta e economic hitman. Worst ever regime, has promoted smuggling, and introduced !nd!a as a major supplier to Pakistan, not saying !nd!a should not be a supplier but engineering commodity shortage and than making legislation /ordinance to justify tax free import from !nd!a is CRIME lead by highest office.

Similar is the case of oil smuggling from Iran, having worst ramifications to the scarce (petroleum) industry.

When all of this wasn't enough, ruling clan imported millions of people from COVID full state, another attempt to stop the wheel of economy, commerce and education. Could have been worst.

In simple words, Imran Khan and mafia has hurt Pakistan so much in 3 years, which is hard to gauge. While the lazy PMLN has overlooked daily crimes against the sovereignty and security of Pakistan... what's going on in with political parties in Pakistan?

This nation need another Zia ul Haque, who shall reverse all the anti development steps, this new Bhutto has taken.

 

[Baz2020]

Anyone who mentions sharif is right needs to meet me in person because I really would like to research on the mental state of such people

 

[muhammadhafeezmalik]

I actually disagree with your point of view. We only have a few items to export (textiles, IT, and low-cost products such as fans and small electric appliances), but we have a population of 200 million people who can consume a lot of products if given the opportunity, so we always make it difficult for our importers to ensure that the gap between import and export does not widen to the point where it becomes unsustainable.

Importing raw materials hurts our little industrial sector, and I honestly feel that we must promote our industrial sector regardless of the circumstances.

Yes, value addition and innovation are key for promotion of export. We are still producing denim cloth which we were producing 50 years ago at almost same rate. We had lost billions in export of leather cloths because of non-innovative policies of tanneries.