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SBP forex reserves plummet to lowest level since April 2014

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  • Lack of foreign assistance put a heavy dent in reserves.
  • Overall liquid foreign currency reserves stand at $12 billion.
  • SBP cites external debt repayments as reason behind this decline.

The State Bank of Pakistan’s (SBP) foreign currency reserves have dropped to levels worth just eight weeks of imports, their lowest since April 2014, central bank figures showed on Thursday.

In a statement, the central bank said the foreign currency reserves held by the SBP were recorded at $6,116.2 million as of December 16, down $584 million compared with $6,700 on December 9.

The drop means the reserves have fallen further from last week’s barely 1.5 months of import cover, even as it battles decades of high inflation and scrambles to secure International Monetary Fund (IMF) funds.

Overall liquid foreign currency reserves held by the country — including net reserves held by banks other than the SBP — stood at $12,000.1 million.

SBP forex reserves plummet to lowest level since April 2014

Net reserves held by banks amounted to $5,883.9 million. The central bank cited external debt repayments as a major reason behind this decline.

Pakistan has recently been battling to stave off a balance of payments pressures due to dwindling foreign currency reserves and a widening current account deficit.

The lack of foreign assistance amid delay in the revival of the IMF programme in the presence of a higher trade deficit and increasing foreign debt payments put a heavy dent in the reserves.

The ninth-review talks have been delayed apparently due to Fund’s criticism over an increased fiscal deficit.

The government is unwilling to impose more taxes for higher revenues, while the IMF insists the government must consolidate the economy.

Moreover, Pakistan’s rupee has shed nearly 26% since the start of the year, hitting its weakest level on record in September, due to falling reserves and the higher import bill.

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The inaugural flight of Azerbaijan Airlines is between Baku and Karachi.

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The national airline of Azerbaijan launched direct flights from Baku to Karachi today. There will be two weekly flights on this route, on Thursdays and Sundays.

The first flight will land in Karachi, and Azerbaijan’s ambassador, Khazar Farhadov, will be there to greet it.

This evening also marks the departure of the inaugural flight from Karachi to Baku, in addition to the arrival of the flight from Baku.

Azerbaijan Airlines said last month that it would be growing its network and flight operations in Pakistan.

Aviation insiders have verified that Azerbaijan Airlines is preparing to launch service to Karachi in the coming month of April.

In addition to its current services in Islamabad and Lahore, the airline plans to launch its Karachi route on April 18, with the inaugural flight anticipated to depart on that date.

Azerbaijan Airlines has been given permission to operate flights on the Karachi route, according to sources within the Civil Aviation Authority (CAA).

Following a bilateral agreement between the two nations, Azerbaijan Airlines has been given permission to extend its operations in Pakistan.

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Fly Jinnah opens a new route internationally.

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Two weekly flights will be the starting frequency of the new route, which will connect the two cities.

According to a representative for Fly Jinnah, the company is pleased to announce the opening of a third international route from Islamabad to Muscat, the capital city of Oman, marking another significant milestone after the successful debut of flights from Islamabad and Lahore to Sharjah.

According to him, this development is in line with our goal of giving our clients more options for reasonably priced, value-driven local and international air travel.

The airline serves five main cities in Pakistan: Karachi, Lahore, Islamabad, Peshawar, and Quetta. Its fleet consists of five Airbus A320 aircraft, all of which are contemporary.

In addition to the current flight path to Sharjah, United Arab Emirates, this new route expands Fly Jinnah’s network of foreign destinations.

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Tajir Dost app: traders don’t seem interested in registering

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To tax retailers in Pakistan, the Tajir Dost app was released. The sources stated that the government hopes to tax 3.5 million merchants through the app.

Ajmal Baloch, the president of All-Pakistan Anjuman-e-Tajran, stated that he made reservations with FBR on the SRO within a week.

The Federal Board of Revenue (FBR), according to him, cannot be a “Tajir Dost” because of its unethical actions.

Baloch believed that since electricity bills allow traders to pay a predetermined advance income tax, further taxes are unnecessary.

The trader, according to him, is already paying thirteen different kinds of taxes on the commercial meter. “A trader already pays between Rs. 15,000 and Rs. 20,000 in taxes annually, but you are requesting Rs. 1,200 per month in taxes.”

Mr. Ajmal summoned representatives of the Federal Board of Revenue (FBR) to a meeting with the trade associations to talk about the indirect taxes that the merchants are paying.

Additionally, he claimed that FBR officers are charging the traders, the majority of whom are less educated, “monthly charges.”

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