Dropping remittances.

ONE hopes the 19pc year-over-year decline in December remittances has given the resident 'wizard' in Q Block some pause. Amidst declining exports and immense pressure on what remains of the country's meagre foreign exchange reserves, the country needed those remittances to pad its books. Yet Pakistanis abroad sent less money home, thanks, in part, to our finance minister's unhealthy obsession with controlling the exchange rate. Market watchers said people have started giving preference to illegal hundi and hawala networks to remit money, as their operators - shady and unsavoury though they may be - are still giving people better conversion rates than the farcical official exchange rate maintained by the State Bank. That theory seems to be supported by the overall trend in remittances, which have posted a decline in each subsequent month for the past four months.

For an idea of just how important these remittance dollars are for Pakistan, one need only look at where the country stands at the moment. Remittances in the recently concluded six-month period of July-December 2022 were clocked at $14.1bn, $1.7bn less than in the same period last year ($15.8bn). The State Bank currently holds less than $4.5bn in its own reserves. It has been declining requests to...