Rupee fall benefits expats' families: Baqir

LONDON: Remarks made by Reza Baqir, the governor of the State Bank of Pakistan (SBP), about the benefits of currency devaluation for overseas Pakistanis have elicited strong criticism by citizens and economists back home.

At a dinner held in honour of the SBP governor in London by businessman Anil Mussarat, Mr Baqir touched on the issue of the depreciation of rupee and attempted to present it as some sort of silver lining for those overseas Pakistanis who send remittances to family members.

"The families of overseas Pakistanis in Pakistan benefit, because the volume of their hard-earned remittances are now increasing because of the exchange rate," Mr Baqir said at the event on Monday.

"Let me explain the quantum of this. Though some lose out from the exchange rate increase, some also benefit. For example, if in this year remittances are approximately $30 billion - we hope they are higher - and if our exchange rate depreciates even 10 per cent, then it translates to an additional $3 billion reaching families of overseas Pakistanis in Pakistan. In every economic policy, there are advantages for some and disadvantages for others," he said.

SBP governor's comment termed 'most irresponsible'

He also said, "Obviously, those who buy imported items are facing difficulties. Those who have the ability to go on foreign trips or buy very expensive imported things obviously will be squeezed. But there are those who have benefited, and those are the families of overseas Pakistanis in Pakistan."

His remarks were recorded by journalists present at the interaction, and a video of his short press briefing went viral on social media. Many users questioned how the governor of the State Bank can praise the devaluation of his own currency.

One user pointed out that devaluation does not rehabilitate economies, but instead raises debt, cost of imports and slows down economic activities.