Role of banks with SBP in management of FC accounts become worst to worst

Earlier one, A. RAZZAK of United Kingdom opened his FC account currency No. 00081300201370 in Askari Bank Islamabad and after losing few pounds withdrew his remaining balance in thousands. The reason of the bank was that since account remained non operative hence it had become dormant. Looking after Pakistan conditions such restrictions would have been avoided in case of non residents living outside. This was the case of some few years back.
This happened in my case as well but not for the reason in case of A Razzak. My daughter settled in London recently sent me few pounds from her account in London into my foreign currency account maintained with Askari Bank Malir Cantt in pounds. The transfer of amount has been delayed and delayed by two banks in Pakistan i.e. Askari Bank and Standard Chartered Bank with its Nostro. To delay the transaction they are asking irrelevant questions like where I was born and what my date of birth is whereas each and every information is available with the bank in my opened account and further being a tax filer. Why they are delaying. To my views these banks are part of the mafia along with money changers FX smugglers and SBP. They all want that FX should not move into any valid FC account maintained in Pakistan.
Being Ex Director of State Bank of Pakistan (SBP) and currently Chairman of Centre of Advisory for Islamic Banking and Finance I know the abc of such transactions.
For the awareness, I would recall that in 1990’s era Nawaz Shareef government allowed current account (transactions moved by individuals) totally convertible whereas Capital account (i.e. transactions moved by entities, companies or corporate were not allowed). For Capital account SCRA accounts were allowed in the banks for corporate, entities and companies. In SCRA FX could be brought in to Pakistan in Foreign currency and were changed in to PKR at the current rate than it is invested in Stock Exchanges. To return the profit earned and face value they could do it through SCRA but for getting the foreign currency they have to change the PKR into foreign currency at the prevailing PKR/dollar or other currencies rate. In regard to investment in Pakistan the company’s could withdraw it after given period. This may be remembered here that at that time conversion of PKR in value was not done by the FX Market that was ultimately allowed in 2000.
However this was going well when international ban was imposed when Pakistan did its experience of using atomic arsenal in 1998-99 and in response to save itself from default all FC accounts were brought into a freeze. Later on against this amount US Dollar Bonds were issued.
Pakistan has always remained short of Foreign Exchange with minus balance of current accounts each year. Last year i.e. June 2018 it saw deficit of US $ of around 19 billion. This year it may remain within $ 15-16 billion. FC deposits up to May 2019 are at $ 7.6 billion, FX Reserves are at $ 16 billion as of May 2019 with SBP holding $ 9 billion. In 2016 the reserves were at 23 billion with SBP holding $ 18 billion. So one can see that how political and economic stability plays its role. Though to some people PML N Government was corrupt but in respect to economy of the country they were far better.
In fact in 2017 dharnas of Imran Khan and then takeover of government with consistent U Turns in the economy he has brought the country in to chaos and almost near to bankruptcy. The SBP and banks are also standing with Imran Khan to confuse the market. Just suppose if FC accounts of $ 7.6 billion are withdrawn than what effect it would bring to the country.
So finaly I propose that FC account maintenance may be made easy. Non Filers may also be allowed to open FC account. Dormancy condition may not be levied on non residents accounts and amount received be credited in to FC accounts without a lapse of any second.

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