ISLAMABAD: The Senate Standing Committee on Commerce has expressed concern over devaluation of rupee by the State Bank of Pakistan without making analytical assessment about its impacts on the national exports.
“Around half of foreign exchange earned from the exports is spent on import of raw material for the value added products to be manufactured within the country. Therefore, devalued currency automatically raise the cost of domestic production,” said that chairman of the committee Senator Shibli Faraz while talking to Customs Today after an in-camera session of the committee with SBP officials.
He said that SBP officials were not well prepared on the issue so they could not satisfy the committee on making such a decision without making an assessment of its impact on the national economy. Moreover, he said that SBP officials also could not respond to the questions about further depreciation of the currency against dollar in coming days.
Shibli said that committee had sought details of the irregularities in National Insurance Company Limited and directed the NICL to submit a detailed record along with a report on action taken against those involved. The committee also expressed displeasure over the appointment of chief executive officer of National Insurance Company Limited (NICL).
“I asked for providing details of recovery made so far from the people involved in corruption, besides furnishing the reports of total cases traced and how many were completely settled and what was the number of the cases that were partially resolved” he added. The Chairman of the committee also asked for providing career record of newly appointed CEO NICL Rafia Shah and details of perks and privileges being provided to her.
Meanwhile, Secretary Commerce and Textile Industry informed the meeting that non-performing loans (NPL) in textile sector was recorded at Rs188 billion and the companies went into recession and stopped their operations.
He said that State Bank of Pakistan has identified that main reason behind the NPL was the investments made by these companies in other sectors like real estate in order to gain more profit. He said that textile sector has acquired about Rs786 billion loans during last five years as it witnessed significant increase for the development of the sector.