Roshan Digital Account program boosts Pakistani rupee

The Pakistani rupee has emerged as the top-performing currency in Asia, showcasing significant strength against the US dollar over the past year. This remarkable achievement can be attributed to the success of the Roshan Digital Account (RDA) program, which has attracted over $8 billion in foreign currency inflows since its launch in September 2020. Non-resident Pakistanis have played a pivotal role in this success story, with their contributions surpassing the $8 billion milestone recently.

The surge in inflows through the RDA has not only bolstered the currency but has also contributed to stabilizing the country's foreign exchange reserves, which have reached a 10-month high of $9.15 billion. Factors such as robust workers' remittances, steady export earnings, and financial support from international organizations like the IMF and World Bank have further supported the appreciation of the Pakistani rupee.

Despite its recent strength, there are differing opinions on the true value of the Pakistani rupee. While some experts argue that the currency is undervalued and has room for further appreciation, others believe it is currently overvalued. The central bank's interventions in managing the currency's value by purchasing surplus dollars have been instrumental in maintaining foreign reserves and meeting debt repayment obligations.

Looking ahead, concerns loom over the sustainability of the rupee's current value. Some experts foresee a gradual depreciation in the coming months, citing challenges such as limited import growth and economic constraints. The IMF has also projected a depreciation of the rupee in the next year.

While the Pakistani rupee has demonstrated resilience and strength in recent times, uncertainties persist. Balancing the currency's value, ensuring adequate foreign reserves, and fostering sustainable economic growth will be critical priorities for the country's financial authorities moving forward.