Currency traders in Pakistan are attempting to restore financial and trade links with Dubai after the regional conflict disrupted normal commercial activity between the two hubs.
Market participants said flights from Karachi and Lahore were expected to depart for Dubai carrying representatives of exchange companies seeking to resume foreign currency transactions that have stalled due to the ongoing tensions, reported Dawn.
Zafar Paracha, General Secretary of the Exchange Companies Association of Pakistan, said exchange companies had accumulated foreign currencies such as Saudi riyals and UAE dirhams and were planning to send them to Dubai to purchase US dollars.
According to the report, one representative was expected to travel on an Emirates flight from Lahore to carry the currencies and conduct the transactions. Traders say Dubai plays a central role in Pakistan’s foreign exchange market, with hundreds of Pakistani businesses operating there to benefit from tax advantages and financial services unavailable domestically.
Malik Bostan said about $50 million in non-dollar foreign currencies has accumulated in Pakistan due to disrupted trade, and converting them into dollars through Dubai could help restore normal forex flows.
Despite the disruption with the United Arab Emirates, Pakistan’s second-largest trading partner, foreign exchange reserves held by the State Bank of Pakistan rose by $87 million to $16.3 billion, with total liquid reserves at $21.43 billion.
