NA body directs SBP to keep eye on rising trend of inflation, dollar rates.

ISLAMABAD -- National Assembly Standing Committee on Finance and Revenue has directed the State Bank of Pakistan to keep an eye on the rising trend of inflation rate and dollar rate.

The Standing Committee on Finance and Revenue met under the chairmanship of Qaiser Ahmed Sheikh, MNA in the Parliament House, Islamabad. The committee has discussed the inflation rate and soaring dollar value against the rupee. The committee has expressed concern over the higher inflation rate and continuous currency depreciation. The committee was of the view that State Bank of Pakistan should exercise its authority and control the problems. Chairman Standing Committee said that increase in interest rate was not a solution to control inflation. Besides, inflow of dollars should be encouraged through exports. The Committee was apprised by the Deputy Governor State Bank that inflation was a huge problem and in order to address it, its root causes had to be addressed. He said that global increase in prices of commodities and natural calamities had affected supply chain.

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He also apprised about the increase in interest rate, restriction on import of luxury items and facilitation to the exporters/importers. Apprising about the increase in rate of dollar, he said that the SBP does not fix the price of dollar and it is based on market. He said that state Bank had taken various administrative measures to check the price of dollar in the open market. He also informed that there was a significant difference between outflow and inflow of dollars. Later, the Committee directed the State Bank to keep a vigilant eye on the rising trend of inflation and dollar.

Minister of State for Finance and Revenue Ayesha Ghous Pasha gave a comprehensive briefing on IMF agreement with Government of Pakistan for extended fund facility. She apprised the Committee that the program was suspended by the IMF due to deviations by the previous government. She apprised that the agreement was thoroughly negotiated keeping in view the national interests of Pakistan. She agreed that the economy cannot be uplifted by quick fixes. She stressed for structural changes and long term policies for making the country's economy vibrant and growth oriented. The minister of state informed that circular debt management, income tax reforms and divesting shares of state own organisations were some of the major points.

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