Pak Govt plans massive printing of currency

Discussion in 'China' started by Galaxy, Sep 21, 2011.

  1. Galaxy

    Galaxy Elite Member Elite Member

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    Govt plans massive printing of currency


    ISLAMABAD: After its existing loan package with the IMF ends on September 30, Pakistan has decided to start planning to print currency at the maximum to plug the big hole in the power sector which sucks about Rs280 billion every year, a senior official told Our Sources.

    “Under its master plan to clinch the next general elections, the government will not increase the power tariff by Rs15.6 percent in 2011-12 as worked out by the ministerial committee on energy,” the official said. “The government will not implement power sector reforms or introduce efficiency in collecting electricity bills and running electric power generation and distribution companies to turn the bleeding power sector into a profit-making sector.”

    According to the official, the government will lose its authority and powers to meddle in the affairs of Gencos and Discos if power sector reforms are implemented, Pepco is dissolved by October 31, new chief executives are appointed from the open market in all electric power distribution companies and board of directors of Gencos are constituted and notified as done in the case of Discos. “Since the government has made a plan to recruit its own party workers and well wishers to pave the way for victory in the coming elections, the implementation of power sector reforms is in jeopardy,” the official said.

    According to one estimate, running defaulters owe Rs89 billion as of today, but since they are influential business tycoons and feudal lords, Pepco will continue to extend them electricity supply despite the fact that they are not paying their bills. “The government, no more under IMF compulsions after quitting its programme, will not be in a position to offend influential defaulters keeping in view the future elections,” the official said.

    The government will go for a massive surge in printing currency notes to generate liquidity to overcome the chronic issues of circular debt of Rs247 billion and bridge the gap of 20 percent (Rs1.60 per unit) between the determined and notified tariff. This decision, the official argued, might help win the hearts of the masses, but printing currency notes will ultimately cause a massive surge in inflation, already hovering at 14 percent.

    “This means the masses for whom tariff rationalisation is not materialised will be the losers in the end as printing currency is inflationary,” the official added. “The government may harness short terms gains out of its master plan, but the country will be the loser as the economy will collapse as a result of a massive printing of currency.”

    The government would, the official feared, also flout the understanding given to the IMF by not surrendering its rights to Nepra about notifying the electricity tariff. “It seems, in case the power regulator gets the power to notify the electricity tariff as earlier agreed with IMF, the government will stand nowhere among the masses because it would be left with no option but to increase the tariff to be notified by the power regulator,” the official added.

    Govt plans massive printing of currency - PakTribune
     
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  3. Param

    Param Senior Member Senior Member

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    Hope they only print Pakistani Currency.
     
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  4. Galaxy

    Galaxy Elite Member Elite Member

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    Except 1 USD = 100 Pakistan Rs. soooooon, Also add more high inflation. That's why IMF said pak budget as bogus !!
     
  5. agentperry

    agentperry Senior Member Senior Member

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    everything is going as per RAW's report on regional affairs. they predicted that by the end of decade pakistan will succumb to war on terror and will lose economically like no other nation. this will be big price for the second hand defence stuff they get for free from usa and nato. they predicted it 10 years ago and everything is falling on its place exactly. people can search that report i had read it 4 years ago and everything except natural disasters are as per that plan. ( pls dont come up with conspiracy theories. all of you)
     
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  6. ace009

    ace009 Freakin' Fighter fan Elite Member

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    INFLATION!! Soon Pakistani people will take a bagful of money to the market to get a walletful of vegetables ...
     
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  7. Blackwater

    Blackwater Veteran Member Veteran Member

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    na-pak people don't buy vegiies, they buy bomb,Ak-47 etc etc..:whistle::whistle:
     
  8. agentperry

    agentperry Senior Member Senior Member

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    they will be soon winning aks and bombs in talent hunt shows like somalia.
     
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  9. pmaitra

    pmaitra Moderator Moderator

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    The total number of Pakistani Rupees is n and the total gold reserves is y kilograms, each Pakistani Rupee is worth ( y kilograms / n ), not accounting for other adjustments. I won't count on the money they owe others because it looks like they will never pay.

    On a related note:
    Idi Amin Dada actually wanted his countrymen to have a lot of money, in his early years of Presidency. His solution was to print more currency, which brought in turmoil, destroyed business and the country slid into utter chaos.
     
    Last edited: Sep 21, 2011
  10. ace009

    ace009 Freakin' Fighter fan Elite Member

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    Well, the US dollar has abandoned Gold standard a long time ago, why can't Pakistan do that? Afterall according to themselves, they are a military and economic superpower too. :D
     
  11. Ray

    Ray The Chairman Defence Professionals Moderator

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    Sinking....sinking...nearly sunk!
     

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