Amidst the ongoing JIT saga, the ruling party received yet another jolt this week when the value of the Pakistani Rupee fell by 3.1 percent — the largest depreciation in nine years — causing a stir in Islamabad and capital markets. Finance Minister Ishaq Dar was quick to distance himself from the currency’s fall from grace, instead claiming it was artificial. The State Bank of Pakistan, for its part, refused to take responsibility for the hit while, nevertheless, insisting that this would be good for the country’s economy. The contrast in these two responses is quite puzzling. Pakistan adheres to a managed floating exchange rate, which in essence means that our government does not allow this to either fall below or rise above certain prescribed boundaries set by it. The fact that the exchange rate was allowed to devalue, then, raises the question of who authorised the move, and points to a possible lack of communication between different state bodies. Such haphazard management of the economy is not only harmful, but also shows how perhaps the incumbent government’s attention is fixated on its political and legal battles, instead of steering the economy. Contrary to Dar’ claims, the devaluation was very much natural and, in fact, needed. A year ago, the International Monetary Fund (IMF) claimed that Pakistan’s exchange rate was artificially overvalued by 20 percent. It recommended devaluation in order to boost exports. Considering how Pakistan’s exports continue to fall — we must question why the government continues to insist on such overvaluing of the Rupee. The answer, perhaps, lies in Dar and his cohorts’ obsession with using numbers to promote an image of Pakistan that runs contrary to facts. A strong Rupee against the Dollar, for instance, suggests that the country’s economy is growing and not lagging behind other global economies. This is completely false and significantly impacts our exports, which are now overvalued in terms of the global economy. Recently, countries like China, Turkey and Thailand have devalued their currencies to give impetus to exports. Pakistan, which already suffers from languorous economic activity, cannot afford an overvalued exchange rate in today’s competitive environment. Perhaps Ishaq Dar would do well to focus on the economy rather than launching tirades against opposition politicians. Alas, if only our ministers agreed. * Published in Daily Times, July 8th , 2017.