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Pakistan's crackdown on black market dollar trade pushes deals online
Pakistan's crackdown on black market dollar trade pushes deals online

Business Recorder

time7 hours ago

  • Business
  • Business Recorder

Pakistan's crackdown on black market dollar trade pushes deals online

KARACHI/PESHAWAR: Pakistan's crackdown on black market dollar trading has strengthened the rupee, but traders say under-the-counter deals have swiftly shifted to smartphones and home deliveries instead. Many unlicensed exchange shops have been shut since July 22, when the military spy agency summoned representatives of the sector to explain the U.S. dollar's rising cost in the open market. Soon after, raids were carried out by the Federal Investigation Agency, which tackles financial crime and smuggling. Since the crackdown began, the rupee has rebounded from a sharp fall against the dollar earlier in July. In the open market, it firmed from 288.6 per dollar on July 19 to about 286 in recent sessions. But traders and bankers say the trade continues, suggesting the crackdown's effects could be short-lived. The black market operates outside official channels and includes unlicensed dealers, personal networks, and digital peer-to-peer exchanges, with customers seeking to skip tax declarations, avoid burdensome paperwork and bypass limits on official currency purchases. In Peshawar, a city near the Afghan border long known for black market currency deals, many shops in the historic Chowk Yadgar district remain shuttered, though some traders were still operating discreetly in back-alley booths. 'The trade didn't stop. It just moved,' said Ahmad, a dealer whose family has been in the business for generations. 'Now it's on WhatsApp. If you know someone, the dollars come to your house.' 'The big players have shifted to safer locations and kept going,' said another trader, Gul. Both traders asked not to give their full names. Rupee gains against US dollar amid reported crackdown Even retail buyers are bypassing the formal foreign exchange market. Hassan, a manager at a multinational firm in Karachi, said stricter documentation drove him to an informal forex chat. 'Everyone there is a buyer or seller. No middleman, no commission. Sometimes it's physical cash, sometimes bank transfers, sometimes crypto,' he said. Stricter FX discipline On Monday, Pakistan's central bank called in bank treasury heads to address pressure on the rupee. Two bankers said they were told to stop buying dollars from exchange companies at above-official rates on the grounds it was skewing the market. Banks were asked to rely on their own inflows from exports and remittances, but both sources have slowed. Exporters are delaying bringing money home, betting the rupee will weaken. Remittances are also tapering off as banks reduce incentives once offered to attract overseas inflows. Authorities also pressed banks to keep the gap between the interbank rate and the open market rate narrow, a condition of Pakistan's $7 billion IMF deal meant to discourage speculation. 'These meetings have been happening for years, but this one was more pointed,' one banker said, speaking on condition of anonymity. The central bank is expected to cut rates on Wednesday, easing inflation but risking pressure on the rupee.?

Pakistan's crackdown on black market dollar trade pushes deals online
Pakistan's crackdown on black market dollar trade pushes deals online

Reuters

time9 hours ago

  • Business
  • Reuters

Pakistan's crackdown on black market dollar trade pushes deals online

KARACHI/PESHAWAR, Pakistan, July 29 (Reuters) - Pakistan's crackdown on black market dollar trading has strengthened the rupee, but traders say under-the-counter deals have swiftly shifted to smartphones and home deliveries instead. Many unlicensed exchange shops have been shut since July 22, when the military spy agency summoned representatives of the sector to explain the U.S. dollar's rising cost in the open market. Soon after, raids were carried out by the Federal Investigation Agency, which tackles financial crime and smuggling. Since the crackdown began, the rupee has rebounded from a sharp fall against the dollar earlier in July. In the open market, it firmed from 288.6 per dollar on July 19 to about 286 in recent sessions. But traders and bankers say the trade continues, suggesting the crackdown's effects could be short-lived. The black market operates outside official channels and includes unlicensed dealers, personal networks, and digital peer-to-peer exchanges, with customers seeking to skip tax declarations, avoid burdensome paperwork and bypass limits on official currency purchases. In Peshawar, a city near the Afghan border long known for black market currency deals, many shops in the historic Chowk Yadgar district remain shuttered, though some traders were still operating discreetly in back-alley booths. "The trade didn't stop. It just moved," said Ahmad, a dealer whose family has been in the business for generations. "Now it's on WhatsApp. If you know someone, the dollars come to your house." "The big players have shifted to safer locations and kept going," said another trader, Gul. Both traders asked not to give their full names. Even retail buyers are bypassing the formal foreign exchange market. Hassan, a manager at a multinational firm in Karachi, said stricter documentation drove him to an informal forex chat. "Everyone there is a buyer or seller. No middleman, no commission. Sometimes it's physical cash, sometimes bank transfers, sometimes crypto," he said. On Monday, Pakistan's central bank called in bank treasury heads to address pressure on the rupee. Two bankers said they were told to stop buying dollars from exchange companies at above-official rates on the grounds it was skewing the market. Banks were asked to rely on their own inflows from exports and remittances, but both sources have slowed. Exporters are delaying bringing money home, betting the rupee will weaken. Remittances are also tapering off as banks reduce incentives once offered to attract overseas inflows. Authorities also pressed banks to keep the gap between the interbank rate and the open market rate narrow, a condition of Pakistan's $7 billion IMF deal meant to discourage speculation. "These meetings have been happening for years, but this one was more pointed," one banker said, speaking on condition of anonymity. The central bank is expected to cut rates on Wednesday, easing inflation but risking pressure on the rupee.​

Pakistan's crackdown on black market dollar trade pushes deals online
Pakistan's crackdown on black market dollar trade pushes deals online

Arab News

time9 hours ago

  • Business
  • Arab News

Pakistan's crackdown on black market dollar trade pushes deals online

KARACHI: Pakistan's crackdown on black market dollar trading has strengthened the rupee, but traders say under-the-counter deals have swiftly shifted to smartphones and home deliveries instead. Many unlicensed exchange shops have been shut since July 22, when the military spy agency summoned representatives of the sector to explain the US dollar's rising cost in the open market. Soon after, raids were carried out by the Federal Investigation Agency, which tackles financial crime and smuggling. Since the crackdown began, the rupee has rebounded from a sharp fall against the dollar earlier in July. In the open market, it firmed from 288.6 per dollar on July 19 to about 286 in recent sessions. But traders and bankers say the trade continues, suggesting the crackdown's effects could be short-lived. The black market operates outside official channels and includes unlicensed dealers, personal networks, and digital peer-to-peer exchanges, with customers seeking to skip tax declarations, avoid burdensome paperwork and bypass limits on official currency purchases. In Peshawar, a city near the Afghan border long known for black market currency deals, many shops in the historic Chowk Yadgar district remain shuttered, though some traders were still operating discreetly in back-alley booths. 'The trade didn't stop. It just moved,' said Ahmad, a dealer whose family has been in the business for generations. 'Now it's on WhatsApp. If you know someone, the dollars come to your house.' 'The big players have shifted to safer locations and kept going,' said another trader, Gul. Both traders asked not to give their full names. Even retail buyers are bypassing the formal foreign exchange market. Hassan, a manager at a multinational firm in Karachi, said stricter documentation drove him to an informal forex chat. 'Everyone there is a buyer or seller. No middleman, no commission. Sometimes it's physical cash, sometimes bank transfers, sometimes crypto,' he said. STRICTER FX DISCIPLINE On Monday, Pakistan's central bank called in bank treasury heads to address pressure on the rupee. Two bankers said they were told to stop buying dollars from exchange companies at above-official rates on the grounds it was skewing the market. Banks were asked to rely on their own inflows from exports and remittances, but both sources have slowed. Exporters are delaying bringing money home, betting the rupee will weaken. Remittances are also tapering off as banks reduce incentives once offered to attract overseas inflows. Authorities also pressed banks to keep the gap between the interbank rate and the open market rate narrow, a condition of Pakistan's $7 billion IMF deal meant to discourage speculation. 'These meetings have been happening for years, but this one was more pointed,' one banker said, speaking on condition of anonymity. The central bank is expected to cut rates on Wednesday, easing inflation but risking pressure on the rupee.​

Crackdown on human traffickers, illegal currency networks launched
Crackdown on human traffickers, illegal currency networks launched

Business Recorder

time2 days ago

  • Business Recorder

Crackdown on human traffickers, illegal currency networks launched

ISLAMABAD: In a series of coordinated operations across multiple regions, the Federal Investigation Agency (FIA) has arrested 10 suspects involved in human trafficking, visa fraud, and illegal currency exchange. The crackdown was carried out on the directives of FIA Director General Rafat Mukhtar Raja, as part of an intensified campaign to dismantle smuggling and financial crime networks operating across the country. FIA Multan Zone arrested three individuals, including Feroze Qaiser Sagu, a most-wanted human smuggler. Other arrested suspects include Muhammad Azam and Muhammad Wazir. The trio allegedly defrauded citizens by promising employment abroad, extracting large sums of money without delivering. Feroze Qaiser, apprehended in Khanewal, has nine cases registered against him in the Multan Zone and additional charges in Faisalabad. He reportedly scammed over Rs. 8.2 million from victims by offering fake job placements in Dubai and Saudi Arabia. Muhammad Azam is accused of defrauding Rs. 600,000 under the pretence of employment in Azerbaijan. Muhammad Wazir allegedly extorted Rs. 2.36 million from citizens for promised jobs in the UAE. FIA Lahore Zone conducted raids in Lahore and Islamabad, arresting Naveed Tahir and Zubair Muhammad, both charged with visa fraud. Naveed Tahir allegedly took Rs. 1.68 million from a citizen, promising a job in Lithuania Zubair Muhammad is accused of swindling Rs. 700,000 under the guise of securing a US visa. Both suspects failed to provide the promised visas and had gone into hiding before being apprehended. In another significant operation, FIA Balochistan Zone arrested five individuals — Akmal Khan, Saifullah, Basheer Ahmed, Abdul Qayoom, and Abdullah — involved in illegal currency exchange and Hawala/Hundi operations in Quetta and Chaman Authorities seized a large sum of currency during the raids, including: Rs. 684,000 in Pakistani rupees 230.5 million Iranian Rials over 135,000 Afghanis 700 US dollars, 200 Saudi Riyals, and 150 Australian Dollars. Investigators also recovered cheque books, receipts, and bank slips linked to Hawala operations. The suspects were allegedly operating without proper licenses and failed to explain the source of the recovered funds. All suspects have been taken into custody and investigations are ongoing. According to the FIA spokesperson, the agency remains committed to a zero-tolerance policy against human trafficking, visa fraud, and illegal financial operations.

Consumers pay bitter price for sweetener
Consumers pay bitter price for sweetener

Express Tribune

time2 days ago

  • Business
  • Express Tribune

Consumers pay bitter price for sweetener

In the digital age, there's no excuse for opacity as a transparent digital dashboard that tracks sugar from mills to wholesalers to retailers would make it harder for hoarders and profiteers to operate undetected. Photo: file Due to a lack of government attention, sugar prices have skyrocketed across the country, with an increase of up to Rs60 per kilogram at the retail level. Experts believe that the artificial sugar shortage is a direct result of inaccurate data and flawed decisions by federal institutions concerning sugar production and consumption. In the midst of this crisis, sugar profiteers have become active once again, manipulating prices in major markets across Lahore. The government's weak control has allowed profiteers to exploit the public, which is forced to buy sugar at inflated rates. In 2024, sugar was selling at Rs140 to Rs145 per kilo, but it is now being sold for Rs190 to Rs200 per kilo. The official DC rate remains at Rs145, but no retailer is selling at this price. Retailers argue that they themselves are getting sugar at higher prices. According to Sheikh Tanveer, the price of a 100kg sugar sack was Rs12,000 last year, but due to poor planning, it has now soared to Rs18,000 at the ex-mill rate. "Retailers make little profit, while the real beneficiaries are mill owners and sugar profiteers," said Tanveer. Even though the government claims to maintain complete records of sugar production and consumption, a crisis occurs every year. Citizens claim that due to poor government policies, they are forced to spend their hard-earned money buying sugar at inflated rates. This time, the price hike is not minimal, adding up to Rs40 per kilo. One citizen demanded that the Prime Minister take notice and act against those responsible. "But nothing ever happens in this country," he added. "Inflation robs us in broad daylight. It is the government's responsibility to control prices, yet no department seems to be doing anything," lamented the local. Sources have revealed that the same profiteers, who were previously targeted by the Federal Investigation Agency (FIA) with full force, including arrests and record seizures, are once again operating in an organized manner, as they dominate future sugar pricing, especially in markets like Lahore's Akbari Mandi and Karachi's Jodia Bazaar. The FIA had previously launched a strong crackdown, but suddenly and without explanation, the operation was called off. It is unclear whether this was due to the influence of powerful profiteers or fear within the government, but sources claim officials made personal gains during the process. Till date, not a single sugar profiteer has been brought under the law. According to the Pakistan Sugar Mills Association, the country produced 6.8 million tonnes of sugar during 2024–2025, which was 3 per cent more than the previous year. There was already a surplus of 7 million tonnes last year, prompting the government to allow exports. Despite sufficient availability, hoarders are now creating an artificial shortage once again, pushing sugar prices up to Rs200 per kilo. Currently, Federal Board of Revenue (FBR) representatives have been deployed at sugar mills to prevent tax evasion. According to the FBR, this has improved tax recovery. Additionally, joint raids by the FBR and Intelligence Bureau are being conducted against hoarders across the country to stabilize prices. While there was no price hike during Ramadan, sugar prices have surged once again across the country. However, beyond targeting hoarders, no action has been taken against the profiteers responsible for driving up prices. Meanwhile, the Ministry of Food is preparing to spend valuable foreign exchange on sugar imports. Tendering has already begun, though the next sugarcane crushing season is scheduled to start in November. In this entire scenario, billions of rupees are being drained from the pockets of the poor, while neither the government nor the bureaucracy seems affected.

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