Guest post by A.H.Kalwar of Pakistion Blog
With the current account deficit widening, inflation boiling at over 24% and foreign reserves dieing out at the rate of $1 billion a month. Pakistan’s economic indicators seem to have taken a nose dive. Where did it start and when will it end?
The dollar today stands at over Rs.80 in the open market. Citigroup calls weak rupee ‘a legacy of flawed economic policies’. Economic policies put in place by a generous gift to Pakistan, from Citigroup itself, the MBA-cum-economist Mr.Shaukat Aziz. The other Shaukat, Tareen our latest in the line of Finance ministers boldly throws all the blame on the previous government and it’s “Short-term” aimed policies.
So how the hell did we land up here?, is Zardari secretly stealing all those billions from our foreign reserves? no. I mean I’m sure he’s tempted to, but well that’s not how it works. People frequently ask me how everything went wrong after the PPP-led government took office. The answer to that is, it didn’t go wrong after the new government took office. It went wrong a year before that. When it was obvious to the Chuadries of Gujrat that they’d soon have to vacant government offices they didn’t like it.
The Hidden, and fairly obvious motives.
November 2007; I turn on my TV and a local economist on CNBC is trying to explain to the host the sinister intentions of Musharraf and his minions. Global oil prices have jumped up by almost $20 to $86/barrel in a span of 2 months, domestic prices world over are adjusted accordingly yet prices in Pakistan remain static. The government is providing an subsidy of almost Rs.40 per liter of petrol. Now multiply 40 by the number of liters of petrol sold in 24 hours across Pakistan, that’s the amount of money the government was paying Pak-Arab Refinery daily. Now all of this may seem good for the average automobile/factory owner, and it was in the short-short-term, but that wasn’t what Musharraf was aiming for, he’s smarter than that. The basic motive behind this was political gain, if they could just hold up five more months, the “Petrol ke keemtain bara dee” blame could be thrown on the new government which would either be PPP-led or PMLN-led.
While most people did not release why this was of any concern economists knew exactly where this was headed. Amid worsening economic situation – one of the reasons given for imposition of emergency on Nov 3rd 2007 – this was a deliberate blow to the long-awaited stability Musharraf had gained and was ready to throw down the drain owing to typical politics.
Here’s are excerpts from:
Business Recorder December 12 2007
ISLAMABAD (December 12 2007): President Pervez Musharraf has rejected any change in petroleum products’ pricing policy, leaving no other option for the caretaker government to absorb billions of rupees more as subsidy every month for protecting the consumers from international market price-hike.
A senior official told Business Recorder on Tuesday that after President’s ‘No’ to any change in existing policy there was no possibility of upward revision in oil prices for the next fortnight, commencing from December 16.
…
In the last couple of months of Shaukat Aziz regime, Oil and Gas Regulatory Authority (Ogra), Ministry of Petroleum and Finance made serious efforts to get the policy of capped oil prices changed but they could not succeed. Now in caretaker setup Ogra and related ministries again presented their case with a hope to get positive response but they met the same response of not passing the real prices to the consumers.
…
Now when crude oil prices are ranging between $90 and $100 per barrel, the government is absorbing on average Rs 14 billion every month as subsidy. Such a big hit is widening budgetary deficit and worrying the economic team of the caretaker government.
Dawn newspaper on February 25, 2008
“Can the new elected government take the unpopular step to increase oil prices at the first available opportunity? Or will it allow the subsidy on oil prices to widen the budget deficit and to erode macro-economic stability the way the previous government and the caretakers did? It will be confronted with tough choices.“
These subsidies rose to about Rs 30 billion per month by the time the new government took charge. Domestic prices, static, the president had spoken.
The repercussions
This particular step by Musharraf virtually destroyed our economy, making billions for Pak-Arab refinery in the process. The federal reserves had declined by 37% before April 2008, our Petroleum Import bill had sky-rocketed. For the month of September our monthly import bill was $519.7m. By November it had increased to $939.4m and by the end of April it had reached $1458.8m (monthly), an increase of 280% within 7 months. Instead of cutting the demand, and substituting over to alternates, our nations consumption of oil gradually increased over this period. Opposite to what was happening world over.
Consequently our budget deficit had reached absurd digits, to finance the deficit the government literally printed notes. Below is an excerpt from State Bank of Pakistan’s latest report on Monetary policy:
More importantly, Government borrowing from the central bank was largely on track; as it borrowed only Rs23.2 billion. In short, major economic variables were showing that monetary transmission mechanism was working. However, since November 2007 onwards, monetary tightening began to lose some of its steam. Massive liquidity was injected in the system as the Government borrowed from SBP almost Rs178 billion in November and December 2007. This led to softening of key interest rates and money growth accelerated. At the same time, rising international oil and food prices impacted the inflation outlook and in absence of adjustment in domestic prices the financial burden of subsidies and high spending in other areas resulted in rising economic stress.
This heavy borrowing increased money supply which in-turn gave rise to the inflation and the castle of cards had started to fall, Investor’s got spooked and started withdrawing the dollars, pushing the economy into a downwards spiral. For those of you who do not know what a downwards spiral is, its when ‘Foreign reserves decline due to a reason of concern – in this case rising oil prices fueled by politics – people start withdrawing money from Pakistan, because they withdrew money foreign reserves went down further, again spooking more investors who also take out their money. This creates a cycle of declining foreign reserves”. As a consequence the rupee’s demand went down, increasing our cost of the dollar and in turn of a barrel of oil.
What now?
By now the Global economy has taken a sever hit, world over financial systems are collapsing (or have collapsed). While most developing countries dodged a more critical hit, Pakistan suffered because of its newly inflated Banking sector. Musharraf had actually taken focus off of agriculture – which showed a slow annul decline in his tenure – and manufacturing and pushed an infant economy onto a tertiary sector oriented growth.
Combined with global economic slowdown Pakistan’s near future does not look very promising, where countries like the U.S., France and Ireland can afford bail-out plans of more than half a trillion dollars each, I’m afraid we can-not do the same. While i am extremely negative on taking a loans from a U.S. based bank or fund, right now we do not have much choice.
From how i see it, if steered correctly Pakistan’s economy should be on rail by mid-2009 and blossoming in 2010. This is just a bump in our growth chart, it shall be over soon.
Comments
30 responses to “Pakistan, Forex and Musharraf”
While I agree Mushi was scum bag who did everything to save his own seat (I hate bigots who say one thing and do the other, mushi being the classic example of cursing past politicians for the bad he himself repeated).
Coming back to this article, the reason I dont agree with the conclusion of throwing all the blame on Mushi in that the current government is following the same incompetent policies.
Taking a deeper look at what they’ve done todate:
1. Renamed every dam thing after BB. Wonder who pays for the name change and misc costs
2. Lack of a backbone and strategic foresight in formulating a policy …any policy!
3. Creating useless government departments while sidestepping big ones that need to be tackled upfront (judiciary – rather than restoring it, side dancing on the death penalty. Economy – rather than reviewing the issues and getting ahead of them, blaming some forex dealer and creating a BB income support fund which will sugar coat the issue for a few. Employment – rather than build a safe environment for businessmen to invest, give out jobs to jiala’s)
In summary – this government has clueless and it’ll sink us down under!
if one blames it to Mush then why don’t we bring him back to clear mess, heheh it was evident to every person with an iota of wisdom in his brain that is gonna happen as soon as Mush would leave…. My view can’t be a very popular but very realistic stock exchange was doing great, our feeble economy was somehow moving forward every tom and harry got a car… Real State for the first time in the history made substantial growth what else could you expect from a country who is economically challenged in addition to extremism and terrorism… long story short, people (investors) had faith with mush as he left so do they !!!!
I don’t understand why everyone blames Musharraf.These nincompoops can’t run the govt period.The dollar rate during Musaharraf regime as I remember was 65 Rs, and it stayed that way for years….even if it was artificially maintained that way, I ask these idiots to artificially maintain it for 3 months. Zardari and his gang can’t do it. Its a hopeless situation. I would rather have Musharraf back.
@Darakhshanda Khurram:
The dollar rate in Musharraf’s tenure was around Rs.60 (Rs58-62). But that was entirely do to economic policy, Shaukat Aziz had pegged the rupee with the dollar artificially. This concept in economics is called “fixed exchange rate”, while the new government has a policy of “floating exchange rate”.
The high dollar helps boost our exports, and reduces demand for imports, boosting local industries. Though Rs.80 is a bit too high, and Rs.60 was too low.
@Jaf:
Musharraf’s economic policies were all short-term, we are the worlds 26th largest economy, and we do not run solely on investor confidence. An economy is more than that.
Musharraf took office when the world was coming our of the cyber bubble in 2001 and was ready to boom, and he left at the point when the world went into a recession. Furthermore the most important sectors of the economy (namely agriculture and value-added manufacturing) were neglected and the focus was shifted to Banking and communications. Where Shaukat Aziz had personal stake, they ignored the masses, and created an economic bubble standing over consumer banking.
All in all none of Musharraf’s policies were sustainable.
A man got very sick. He started taking a medicine, that made him progressively better. He left the medicine abruptly. He again got sick.
Moral of the story: It was a bad medicine!
^ Nicely put, if your not very comfortable with economics. Think of it as “Steroids”. When you take them you feel all big and powerful, but after wards you shrink even below you normal size in addition to other side effects.
Pakistan kaa poooraa jism hee beemar thaa, ooper sai Musharraf jaisee choot beemaree bhee lag gaee.
Abb woh beemaree to hat gaee hai, Allah ka shukar magar baqeee marz kaa ilaj baqee hai.
Abb Allah karey kah qaum iss marz sai bhee waisey hee chuktara hasil karey jaisey musharraf sai hasil kiaa hai, yaani baqeee gadhon ko bhee zaleeel karkey nikaley.
@ A.H.Kalwar
First, I must acknowledge Kalwar’s attempt at analyzing the problems of our current economic situation, though not completely correct in the manner he has connected all of the dots. First, the exchange rate policy that Pakistan has adopted, since our last IMF program which was initiated in the 90s, is that of floating exchange rate (though it’s not been practiced that way most of the time). In a ‘fixed exchange rate’ policy, the central bank of the country sets the official rate and all banks must stick to it. This was the policy that Pakistan had adopted in the 80s and in the early 90s until IMF came and suggested otherwise. If you remember, we don’t have exchange rate notifications released by the State Bank as they are done by OGRA for oil prices every fortnightly (now that is highly regulated). If Musharaf government ran the affairs this way, you would be right in claiming that he pursued a ‘fixed exchange rate’ policy, but it actually didn’t. Now, why I say that Pakistan’s foreign exchange rate policy isn’t exactly ‘floating rate’ is because our State Bank (on the advice of the government) pumps in dollars in the open market to keep it around a certain level. This may be termed as ‘attempting’ to regulate the exchange rate around a certain place but it can never guarantee it. If the flight of foreign capital speeds up, this method will hardly have any bearing on the rate.
Now let me comment on your claim that a high dollar rate boosts exports and reduces the demand for imports. Let me tackle the first part of this claim – ‘high dollar boosts our exports’. You are totally right at saying that a weak rupee would help our exporters gain a competitive price advantage in the international markets but please remember that it is only a short-term effect. As the Rupee loses its value, the domestic inflation gets a kick in the rear which forces the State Bank to readjust their discount rate – increasing the cost of production for the industries, which ultimately not only eliminates the short-term benefit earlier reaped by exporters but might even push their costs so high that they find themselves at a disadvantage against their international competitors. Now the second part of the claim – ‘reduces demand for imports.’ While the demand for some imports may reduce by weakening the rupee, this is the worst way to achieve that objective. You and I know that the government has a wonderful tool if it wants to reduce the demand for a certain category of items and this method can be used very effectively to meet that end. It is called ‘taxation.’ The oldest rule in the economics book is ‘if you want less of something – tax it, if you want more of something – subsidize it.’ When one begins to look at reduced demands as a positive side effect of a weaker rupee, one has failed to register the impact of the same on imports of essential items such as machinery for industry expansion, raw material etc. Their increased import bill would pump the cost of production even higher, making them ever less competitive in the domestic or international market.
Moving on to your claim on the cyber bubble and the neglected sectors by the Musharaf government. First of all, the cyber bubble was solely a phenomenon of the American stock market and didn’t have as far reaching effects on the global economy as to bring it to a halt or push it on the road to growth. It’s effects as perceived by you are arguably over exaggerated. Second, you may be right at saying that Musharaf government gave priority to other sectors and not to agriculture. Here, I agree with you. But I disagree with the claim that it also ignored the manufacturing sector. Maybe you haven’t read the economic numbers of 2004, 2005 and 2006 when LSM (Large Scale Manufacturing) grew by over 15% every year. Over 15% growth! In 2006, only China had a higher LSM growth rate than Pakistan – in the entire world. That doesn’t come about by ignoring a sector. In 2006, our textile exports alone were more than $10 billion (just for comparison sake, our total exports in the 90s never reached that number). So to say that the last government ignored the manufacturing sector would be totally absurd. Yes, the focus was certainly more on banking and services and it is open to argument whether they needed that much focus or not.
And yes, Musharaf would do anything to keep his seat but so would any other ruler in a country where democratic institutions aren’t very strong. If you doubt my claim, please consult history. When you are in power, the only reason you give it up is when you know you can’t keep it no more. Only a few leaders in history actually gave up power because they believed someone else could do it better. In Western democracies, power changes every 4 or 5 years because the rulers know if they attempted to stay beyond their given time, their democratic institutions would put them behind bars. So Musharaf isn’t the most evil ruler for having done that – they all are the same – and I don’t mean to stay that what he did was right. It was wrong and cost our country a hefty sum in many respects. But to cast him out as Satan’s most favorite son and blame him for all of the problems is not only childish but also misrepresentation. And if you still doubt my assertion, please wait to see what Mr Zardari does when he feels the pinch. This is why the only solution for us is in stronger institutions.
Having said that, we must acknowledge that during Musharaf’s tenure, the government seemed to have a vision and a set of policies. Their policies might not have been all correct but there were many positives in their initiatives.
We got rid of mushi ‘the cancer’ and welcomed Zardari ‘the AIDS’ (actually we didn’t even welcome him)…
Now all we do is grab a ‘kashkol’ and go around asking for US AID, IMF AID, Foreign AID.
*sigh* Pakistan Khappy (read Khaapay meaning ‘eat up’). You cannot blame zardari for eating up Pakistan’s economy. After all, he did warn us all before taking office when he kept repeating ‘Pakistan Khaapay Pakistan Khaapay Pakistan Khaapay’ … meaning ‘I wanna Eat Pakistan I wanna Eat Pakistan I wanna Eat Pakistan’. and we did not heed that at all.
Pakistan ZINDA BAD! (read Pakistan se ZINDA Bhag!)
we didnt welcome Zardari, he befooled his own people. before elections he said he was not willing to become a president, so that people who hate zardari would still cast vote to PPP. then after getting votes and removing mushi he entered into the scene and completed his long awaited dream of becoming president and taking revenge from his all opponents.
i think if one wonders that it was wrong he must have thought what good one can do by getting in by wrong means by a coup.
Great people who accuse me of being judgmental have decided: Mushraff was Cancer and Zardari is AIDS…
Hypothetically if all of yours wishes comes true and PPP government comes down then what’s next?
Do you guys seriously think Nawaz Sharif would change the current policies regarding War on Terrorism? If he’s any different from Zardari?
The only viable solution is to let the process move go-on; the problem with PPP is the unity of command and indiscipline!
Why live in Past? If we go-back every political party be it PPP, PML-N, MQM, ANP, JUI-F, PML-Q played her part to ruin Pakistan.
I seriously feel pity for people who write sweeping statements for the fun of it like “Pakistan Say Zinda Bhag” – should we seriously expect good from them? instead of commenting on blogs? to change the system you have to be part of it…
@ HBR
Thank you for reading and commenting on my “comments” in such detail.
Coming to the fixed and floating exchange rate policies, they might not have been declared as solid policies but Shaukat Aziz controlled the dollar through injecting and sucking out dollars to keep it stable. This was an attempt to not let ‘his’ or the investors money devalue. You are correct on the part that right now we can not call the exchange rate “perfectly floating” and they have let it slide BUT they kept injecting some dollars to dampen the slide, they still let the rupee devalue. As per IMF’s request.
Because i mentioned the import/export – exchange rate phenomena in one of my comments i made it extremely brief and did not mention many other key factors that come into play. The situation you have mentioned is one of the many possibilities, and could be true, but is unlikely. The main key indicator i did not mention is the elasticity. If the elasticity of imports is higher than the elasticity of exports than devaluing the currency is most certainly favorable. While if the imports are more inelastic than the exports than the opposite is true. In Pakistan’s case our imports are definitely more elastic, because unlike some countries we have natural gas fields substituting a major part of our oil import. And our other imports either have substitutes or are luxuries for the rich (i.e. cars, generators etc.). Only a small part of our imports taken by manufacturing machinery. Your case is most certainly true for quite a few other countries.
The reason i mentioned the cyber bubble was while it might not have affected our economy it was a “time” mark. After which global financial systems boomed, right around the time Shaukat Aziz promoted the stock market, and banking sector. Which sailed with the global flow.
About the LSM. Where do you get your figures from?, LSM’s growth has been declining for the past three years and has never touched 15% to the best of my knowledge. It has been around 7-8% but declining. Secondly my initial argument was value-added manufacturing.
I totally agree with you on the last part on political psychology, but Musharraf ruined Pakistan in the process of saving his own seat, i mean there was good growth in his tenure but he threw it all down the drain for his goddamn seat, which too eventually he was kicked out off.
While we are fond of complaining about the “failed” system and falling economy, the system still works and the nation still breathes. There is a group of people in every institution who are keeping the system running by their hard work. They are silent warriors and true Pakistanis…while we sit in our couches busy in our pseudo-analyses. Those warriors do not take part in useless arguments…arguments we are so fond of. They keep doing their work without any expectations of appreciation. They are everywhere around us, from the signal-man at a certain faroff railway station in Baluchistan, or the lady health worker somewhere in Tharparker, to the guard who tries to put-off the flames from the nearly-exploding truck outside Marriott…they are everywhere. When we all are willing to be a part of these people who are running the system we would not be complaining about the system anymore, because it will start healing itself.
Sorry but the facts aren’t accurate.
The average price of oil for 2007 was at $65 a barrel.
Given thats at the heart of your argument, I suggest you reconsider.
@Magic Alex
Never did i mention that the average was not around $65 for 2007, neither does it have “any” relevance to my article.
My basic analysis was from August 2007 till April 2008, as that is the time frame of global oil prices sky-rocketing and our foreign reserves falling into a downwards spiral.
All facts and figure are completely authentic, while i have also provided citations.
@Barrister:
LOL, here we go again. Sorry if I offended you with my statements, I really am. The reason why I felt integral to comment on your article was because it was downright good, and a guy like me cannot come up with something like that (because it requires vision). And that was the sole reason why I said if your stance is maintained people will follow you and SO WILL I.
To be honest, as much as I love Pakistan, I have lost hope in its future. On various forums and blogs I have raised the question of how we can save Pakistan and move forward… and I found an overwhelming majority getting involved in arguments of who’s right and who’s wrong and what not. The reason I called Mushi cancer and Zardari AIDs was because I find all (read ALL) of the politicians, shit!
As for ‘Pakistan se ZINDA Bhag’, I believe you have to be living and breathing to effect change. Staying in Pakistan and getting killed in a 12th May, 27th December etc etc incident won’t let us fix the issue.
In the end, I’d again apologize if any of my statements hurt you, they were in good and sincere faith. I never called you judgmental, I said you sound judgmental when you get involved in arguments that will lead nobody nowhere. Even when Rafay Kashmiri said things about you, I replied saying “I don’t know him well enough to jump to conclusions”.
Just don’t take offense from anyone, not even me… and keep up the good work.
Losing Hope in Pakistan? Is a sweeping statement and hopelessness is “haram” where would it leave people like me and Awab who moved back to Pakistan?
The only way this country moves forward is to let the democratic process move on with it pitfalls and drawbacks and eventually things will start getting to normal.
As far as Kashmir Sahib is concerned, I respect him and his opinions – it’s always good to heard different dimensions of truths. I am sure he loves Pakistan if not as much as much then more. If he really wants a change, let the parties which are ideologically close you win and implement there respected policies…
PS.
Nad Mate, I would never take arguments personally in fact I appreciated you. Thanks.
*It should have been,
As far as Kashmir Sahib is concerned, I respect him and his opinions – it’s always good to hear different dimensions of truths. I am sure he loves Pakistan if not as much as much then more. If he really wants a change, let the parties which are ideologically close to him win and implement there respected policies…that’s how civilized societies work.
i am not agree with you this time.
no doubt Petrol has a major contribution to decrease our foreign reserve but not much.
as u have discussed Petrol Imports increase by 300%…
do some math brother
means increase in the Vehicle upto 200%.
for your information mostly new vehicles in Metropolitan cities leased through Bank. But financing facility from offered to very limited clients since last 8-9 months.
not me nor any of my colleague daily go back to home for lunch or evening snacks.. during that months when import rises up to 300%.
oh one more thing i have detailed studied about ” Subsidary”….. Is that means cost of import of per litre is 93 Rs. and Govt. offering us in 53.
Sorry that subsidiary mean opportunity loss.
Fuel import Cost was always lower or almost the same. Suppose Govt. Plan to sold us fuel after adding 50% profit but offering us after 25% profit and that 25% is Subsidiary from profit.
Well Whatever was the case Musharaf also picked up the economy from default state. Last 18 months we have been successfull in restoring democracy so that everybody should gets a piece except Pakistan.
Shahid Masood Ex-PPP worker Political asylum seeker british government welfare seekers taught the lesson of democracy to the innocent citizen of Pakistan. People forget about Motorola, Intel, Redshore, Nextel would ever try to invest in a country which has institutional void. Remember the whole judiciary was restored within 3 months but they have have been pumped by Shahid Masood, Hamid Mir, Ansar to push the MUSH government to the wall. As a result Zardari, Nawaz, Sahid Masood, Salman farooqi, and whole lot got whatever they wished. But our Chief Justice who was the king of protest not get awards..[congrats]
@ K.H. Kalwar
The reference for the LSM numbers I was referring to is the annual SBP report on Pakistan’s economy for FY 2005-06 (Chapter 2, Section 2.1). Please note that LSM growth in 2004-05 was 15.1% and during 2005-06, it was 9% growth. You may download the report at http://www.sbp.org.pk/reports/annual/arfy06/index.htm.
I appreciate your response to my other arguments but I maintain my position. As these are our positions, it wouldn’t be feasible to argue over them any further.
1- Per capita Income of the nation GREW from $450 in 1999 to become $926 in 2007 (when Shaukat Aziz left us) and in 2008 it rose to become $1085. How can those policies by called failed if they INCREASED our PER CAPITA INCOME by 100%?
http://www.finance.gov.pk/admin/images/survey/chapters/01-Growth08.pdf
2- Our External Debt (EDL) to GDP ratio:
In year 2000 it was 52.7
In year 2008 it was 26.9
Our DEBT to GDP ratio decreased by almost half. Are these are not successful polcies of last 8 years of Shaukat Aziz or Musharraf?
http://www.finance.gov.pk/admin/images/survey/chapters/09-External%20debt08.pdf
3- Shaukat Aziz left our Reserves at $16.4 billion (oct 2007) and after he left they started decreasing. It means his policies were correct and the caretaker & PPP govt is responsible for aftermaths.
http://www.sbp.org.pk/ecodata/forex.pdf
Our Economy declined due to incompetent and mindless – Ishaq Darr & Naveed Qamar.
@HBR
You initially claimed that LSM growth was over 15% every year for the past few years. I claimed for the past three years (i.e. 2005,06,07) it had never touched %15 and was declining steadily.
You even specifically pointed out that in 2006 it was over %15, which is wrong and you yourself contradicted in your latest post. It was indeed 9%, and declined further in 2007.
How can the epolicies of Shaukat Aziz be wrong, when he succeeded in increasing our economy by 100%?
Even our PPP Prime minister accepts that our ECONOMY DOUBLED to become $170 billion.
http://www.brecorder.com/index.php?id=825744&currPageNo=1&query=&search=&term=&supDate=
Pakistan’s economy grew by 100% — to become $ 160 billion
Revenue grew by 100% — to become $ 11.4 billion
Per Capita Income grew by 100% — to become $ 925
Foreign Reserves grew by 500% — to become $ 17 billion
Exports grew by 100% — to become $ 18.5 billion
Textile exports grew by 100% — to become $ 11.2 billion
Karachi Stock Exchange grew by 500% — to become $ 75 billion
Foreign Direct Investment grew by 500% — to become $ 8.4 billion
Annual Debt servicing decreased by 35% — to become 26%
Poverty decreased by 10% — to become 24%
literacy rate grew by 10% — to become 54%
Public development Funds grew by 100% — to become Rs 520 billion
LSM (large scale manufacturing) was:
1999-00 : 1.5%
2004-05 : 19.9%
Oct 2007 : 8.8%
http://www.finance.gov.pk/admin/images/survey/chapters/03-Manufacturing08.pdf
To understand the relationship b/w Trade deficit & Foreign reserves and rupee devaluation. Read:
http://presidentmusharraf.wordpress.com/2008/08/21/foreign-reserves-phenomenon-shaukat-aziz-versus-ppp/
@Royal,
Very well put with the evidence.
Any person with even an iota of wisdom cannot deny the above FACTS.
Forex Working At Home
Legitimate, Successful Home Biz For
Make Money 100 % on Autopilot
http://www.tek-consulting.eu
Almost 10 months this PPP govt has been in power, and to this day all they do is complain about Shaukat Aziz. I wish Pakistan could get another Shaukat Aziz stabilized the currency, and grew the economy and foreign exchange reserves.