Forex market reform
THE State Bank of Pakistan’s new directive to exchange companies to submit their day-end closing buying and selling rates for six major currencies to the Foreign Exchange Companies’ Association must boost forex market governance and improve transparency in the open market. The top exchange firms, with a combined market share of 75pc, will now be required to share this information with the association at the close of each day for a more “robust, reliable determination” of the exchange rate. The measure is part of forex market reforms initiated in September to tighten regulatory control over open market operations, reduce volatility, and contain illegal dollar trade and outflow. The bank has already given smaller exchange companies three months to transform themselves into full-fledged forex firms, mandated all firms to increase their capital from the current minimum requirement of Rs200m to Rs500m, excluding losses, by end-December, and instructed the leading banks to “establish their wholly owned exchange companies to cater to the legitimate foreign exchange needs of the general public to foster efficiency…”.
Tighter controls over the forex market and consolidation of smaller firms in the ‘B’ category engaged in the sale and purchase of foreign currencies only had become inevitable in the wake of the quick currency depreciation after the government adopted a market-determined exchange rate and agreed with the IMF to a maximum difference of 1.25pc between the interbank and open market exchange rates over any five consecutive working days. Concerns were raised over the weak operational structure and inadequate compliance levels in the forex market that had led the rupee to fall to an all-time low, the fast erosion of SBP reserves and massive illegal dollar outflows. Though the reforms are crucial for exchange rate stability, the government should take stringent action to control under-invoicing of imports to improve dollar inflows through remittances. Treating one symptom and not others cannot fully restore the market to health.
Published in Dawn, December 28th, 2023
Silent pandemic
DOMESTIC violence — often hidden and underreported — has surged in the shadow of the Covid-19 pandemic, a recent report by the Asian Development Bank has revealed. The loss of livelihoods, heightened stress, and enforced proximity have catalysed an alarming spike in violence against women and children. A survey by ADB found that Punjab and Sindh saw a 40pc increase in spouses threatening their partners with physical violence and a 46pc rise in physical assault. Even children were not spared. Among respondents, 27pc knew of cases where children were beaten by their parents. Such figures point to a grim reality: this deep-rooted societal issue extends far beyond the confines of the household and must now be considered a national emergency. While Pakistan has legal measures including provincial domestic violence laws, their implementation is inconsistent, and a cohesive national law is notably absent. The ADB report underscores the urgency of a multifaceted approach to this crisis. It is not solely about punitive measures but also building a supportive ecosystem for victims and addressing the underlying causes of violence.
Strengthening social protection programmes, such as the BISP, is essential. These programmes should go beyond just financial help, aiming to empower women, dismantle gender stereotypes, and provide essential support to unpaid female caregivers. Another crucial aspect is changing the societal narrative, which requires robust public awareness campaigns that challenge the normalisation of violence and encourage community support for victims. Education and sensitisation programmes can play a significant role in altering perceptions and behaviour. Furthermore, the economic empowerment of women through entrepreneurship and equal access to resources such as land and technology is vital. Empowerment challenges traditional power dynamics and reduces women’s vulnerability to abuse. The private sector’s role in promoting gender equality and women’s empowerment is also critical. Corporate policies must not only support gender equality but also provide safe and equitable work environments for women. As we confront domestic violence, a collective effort from the government, civil society, and the private sector is essential. We need environments where women and children are safe and respected. This requires proactive measures, effective law enforcement, attitude shifts, and economic empowerment. The cost of inaction is too high. We must act now to ensure that our homes are sanctuaries of safety and respect, and not arenas of fear and violence.
Published in Dawn, December 28th, 2023
A level pitch
THE conduct of credible elections is essential for the health of any democratic system. However, throughout our electoral history, holding timely — and free and fair polls — has always been an uphill struggle. Up until a few weeks ago, there were considerable doubts about whether elections would actually be held in February. Thanks to the Supreme Court’s timely interventions those worries have subsided.
Yet an equally important question has arisen about the fairness and transparency of the electoral process. Post May 9, the PTI has claimed it is being erased as a political entity by the state, and there is sufficient evidence to support these plaints.
Amongst the biggest blows the former ruling party suffered was the rejection by the ECP of the PTI’s intra-party polls, and the denial of the bat election symbol. This situation has been rectified for the time being as the Peshawar High Court suspended the ECP’s decision on Tuesday, effectively putting the bat back into the PTI’s hands. The order will remain in the field till Jan 9.
Legal observers say the ECP can either file an intra-court appeal, or petition the apex court to vacate the PHC verdict.
The judicial authorities should consider expediting the hearing of this case to dispel any remaining uncertainty regarding the PTI’s use of its election symbol. Of course, as this paper has consistently stated, the PTI and all other contenders need to be provided a level playing field in order to freely contest the general elections. Yet the PHC’s decision aside, the party still appears to be getting the rough end of the stick.
For example, PTI vice chairman Shah Mahmood Qureshi was manhandled and rearrested outside Adiala jail in an undisclosed case on Wednesday, despite securing bail in the cipher case. Meanwhile, the PTI has also moved a contempt petition in the SC citing alleged violation of the court’s Dec 22 order by the ECP, and seeking an end to the arrests and harassment of its workers and candidates.
In violation of the Constitution, various pillars of state, through their acts of omission and commission, have abetted the delay in holding polls. Further infringement of fundamental rights by manipulating the results of the elections even before the first vote is cast should not be allowed.
In decades past, the National Awami Party, PPP and the PML-N have all had obstacles placed in their way, and now it is the PTI’s turn to face the displeasure of the powers that be.
This subterfuge of the democratic process must cease, and all parties should be allowed to freely campaign for the polls. Moreover, the run-up to elections, as well as polling day, needs to be free of violence and intimidation.
Published in Dawn, December 28th, 2023