A currency shortage and the creation of a black market in Pakistan have added to the country’s long list of troubles. The State Bank of Pakistan’s (SBP) restrictions on foreign currency to maintain the government’s shrinking reserves have created an underground economy for dollars in the country.
The CEO of Ravi Exchange Company Asmat Ullah, declared that a third market has emerged that is expanding exponentially. SBP didn’t immediately respond to Bloomberg’s request for comment. However, it’s pertinent to mention that rapidly depleting foreign reserves compelled the central bank to impose a ban on overseas payments and reduce the limit of foreign currency that a person can carry.
Google has blocked payments through its Play Store after reported a delay for in-app purchases. Honda Atlas Car Limited (HACL) and Toyota Indus Motor Company (IMC) have had numerous weeks-long closures this year because they have been unable to import parts.
The black market for dollars has suddenly boomed across the country. Over 1,000 food containers are stuck at Karachi ports this week because transactions are not being cleared by banks. It is critical that SBP reconsiders its restrictive regulations in order for individuals and companies to utilize proper channels of foreign exchange.