The State Bank of Pakistan (SBP) has initiated an inquiry into issuance of LCs on above values by the banks.
SBP Deputy Governor Dr Inayat Hussain disclosed this in the meeting of the Senate Standing Committee on Finance which met on Wednesday under the chair of Senator Saleem Mandviwala.
The deputy governor said that SBP has initiated the inquiry into the opening of LCs on above values by the banks and the report will be presented before the committee in the next meeting.
Earlier, Senator Shaukat Tarin apprised that owing to this problem, traders have been making payments from Dubai accounts for goods imported from Shanghai.
He added that the banks have issued LCs on Rs. 240 or above when the dollar value was at Rs. 230 in interbank and the profit of banks increased by 100 percent.
Officials of UBL and Bank Al Habib said that in August, they suffered losses of around Rs. 700 million and Rs. 500 Million respectively.
The matter of the unprecedented rise in dollar value was also deliberated. Tarin inquired as to why the dollar value is rising even after the IMF bailout.
Senator Saleem Mandviwalla mentioned that Bangladesh has more reserves than Pakistan but they have taken more stringent measures than us. He suggested that restrictions should be put on the use of fuel as a large sum of money is being spent on the payment for fuel imports.
The committee also discussed the matter of harassment of the citizens by Federal Board of Revenue (FBR) officials. Senator Afnan Ullah Khan said that he was covering a candidate for his late father in senate elections and FBR has ex-parte the matter without serving any prior notice.
He filed a case in the revenue tribunal and the court has decided the matter in his favor, he added. FBR chairman said that an inquiry will be conducted into the matter and the committee will be apprised of the facts within one month.
While deliberating on the decision taken by the Civil Aviation Authority regarding the declaration of foreign currency by inbound international passengers. FBR chairman that matter doesn’t come under the ambit of civil aviation authority. He apprised that, in 2012 State Bank of Pakistan had issued a notification in which passengers carrying $10,000 or more were required to make a declaration, and Customs had also issued a similar notice in 2018 but the threshold was not specified in it. He added that the declaration letter will be available on an App by 30th September.
Senator Faisal Saleem Rehman highlighted the issue of tobacco farmers of Khyber Pakhtunkhwa who are forced to leave this business due to heavy taxation. He told that around 0.5 million farmers have been affected by these hefty taxes. The chair decided to form a sub-committee that will investigate the matter and present its report before the senate body.
The senate body rejected the Bill titled “The State-Owned Enterprises (Governance and Operations)” by a majority vote, while Senator Shaukat Tarin abstained from voting.