KARACHI: Sept 7: Apprehensions of a crackdown on illegal currency trading has stopped upward trend in dollar value in the local currency market.
After weeks of surge, US dollar lost its value by Rs 1 and settled at Rs 306 in interbank on Thursday. It also dropped by another Rs 5 in the open market and settled at Rs 307. In open market, US dollar has lost Rs 25 in just last four working days of the current week. The reduction in dollar value in open market is out of the army chief, Syed Asim Munir, who had hinted at a meeting with the traders in Karachi last week that he wants to see reforms in dollars’ trade. The media reported launch of a possible crackdown on illegal trade of US dollar.
The fears of a possible action has forced “Hundi” and “Hawala” mafias to take a pause and see what comes out of a veiled threat cum statement of army chief , general Syed Asim Bajwa, to the mafia involved in illegal trading of US dollar and other currencies.
Pakistan is a heaven for “Hundi” and “Hawala” for illegal trade of US dolar and other major currencies. “Hawala” and “Hundi” are B team of Pakistani forex companies and authoritsed dealers (The banks).
The banks and currency dealers operate for “Hundi” and “Hawala” through their dedicated teams. These banks and currency dealers have developed a strong network which operates for “Hawala” and “Hundi”. “Hawala” and “Hundi” system flourished with introduction of a unique policy of restricting letter of credits (LCs) for imports by Pakistan Muslim League Nawaz’s economic ‘Hitman’ Ishaq Dar. The policy of restricting LCs has damaged Pakistan more than anything. It created artificial shortage of all kind of raw materials for the industry. Ishaq Dar’s restrictions on imports opened up new channels of “Hawala” and “Hundi” to smuggle dollars from Pakistan. In imports’ restriction regime of 16 months, importers turned to “Hawala” and “Hundi” system for their imports .
According to investigations conducted by NEWSMAN, importers buy dollar and other major currencies from black market at higher rates and pay to “:Hawala” and “Hundi” operators who smuggle dollar via Afghanistan to Dubai. In Dubai, “Hawala” and “Hundi” guys hire agents who manage TTs to world over for imports in Pakistan. Pakistan is losing billions of dollar due to smuggling and this unlawful activity is booming for years. None of the past governments took any practical steps to end “Hawala” and “Hundi’. The same “Hawala” and “Hundi” system is used to launder ill-gotton money out of Pakistan.
This illegal mechanism of ” Hawala and Hundi “ is hurting Pakistan financially very seriously and the forex companies and the authorized agent (The banks) are catalyst for it.
