Pak forex bid with hawala mop-up move

JEDDAH - Pakistani expatriates will get a swifter money transfer option through a Pakistani government project to raise foreign exchange, which is set for launch worldwide Aug. 21.
Currently it takes at least 72 hours for Pakistani expats to bank-transfer money to Pakistan. In the government’s project involving the State Bank of Pakistan, it will take only 24 hours to make a remittance, Federal Minister for Overseas Pakistanis Muhammad Farooq Sattar told Saudi Gazette in an interview.
Speedy, hassle-free service apart, the project is an attempt to steer Pakistanis abroad away from resorting to the unofficial and illegal “Hundi” or “Hawala” system that has long been well entrenched with cash collection points worldwide and delivery links to nearly everywhere in Pakistan.
The “Hawala” system effectively deprives Pakistan of scarce foreign exchange reserves at a time when the country’s economic growth remains anemic. On Aug. 7, the International Monetary Fund, approved a $3.2 billion increase to a $7.6 billion loan sanctioned last year to help Pakistan through its economic hardship. In the week ended Aug. 8, the country’s foreign-exchange reserves rose to $11.846 billion, about a third below its record high of $16.5 billion in Oct. 2007.
Sattar said the speed-cash project is a way for Pakistanis round the globe to help build the country’s Forex reserves, by avoiding the Halawa system.
“For example, the remittances from the UK through the banking system are $400 million and through the illegal channels it is $3 billion,” Sattar said.
“Our aim is to fill the gap and curb this (Hawala) practice.”