The open market is experiencing a shortage of UAE dirhams (AED), as the Gulf state has made it mandatory for Pakistani travellers to declare 5,000 dirhams at the airport upon arrival, according to foreign exchange dealers.
The most recent event has resulted in Pakistan’s currency market falling short of the AED. As a result, the price of the US dollar on the kerb market has risen as well. The price of the greenback increased in comparison to its interbank rate due to a sudden shortage of US dollars in the open market.
According to Malik Bostan, President of the Exchange Companies Association of Pakistan (ECAP), 21 flights from Pakistan land in Dubai each day, carrying a total of 4,200 Pakistanis who require approximately 21 million dirhams per day.
“The dirham is no longer available on the open market, and the fee has also risen,” Bostan explained, adding that “those handy foreign currencies are exported to Dubai to bring back an equal amount of US dollars.” The increased demand for the UAE’s currency has resulted in a dollar shortage.”
According to Bostan, a new Civil Aviation Authority (CAA) law requiring all passengers to declare cash and jewellery has caused this problem. He stated that the majority of visitors from the Middle East arrive with riyals and dirhams. They also receive money from their colleagues and deliver it to their Pakistani households. No Pakistani can now take this risk.
Foreign currency arrivals in the open market have fallen by about $3 million per day, he added. The rupee, which had risen to 207 against the dollar in the open market last week, is now trading at 212. The local currency has also begun to fall in the interbank market.