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AsifAmeer
Why the value of Afghani currency is double of what Rupee is?
Link:
http://www.xe.com/ucc/convert/?Amount=1&From=USD&To=AFN
Ahssan, he wouldn't answer that question. The old brain doesn't work that far.
The fact is Afghanistan was always a big importer of Pakistani products, some of the imports are also reexported to Afghanistan. They are imported to Pakistan with specific orders from Afghanistan. Many in Pakistan makes huge money in this trade.
There is smuggling involve. But fact is Afghanistan imports lots of food crops from Pakistan too.
The Afghani is stronger compare to Pakistani Rupees, because successive Pakistani Government have made this a practice to reduce the value of the Rupees to make the export cheaper in international markets, i.e. in dollars terms.
They couldn't compete with countries like Bangladesh because BD gets preferential treatment in the EU. The margins of the traders were wiped out by the advantage BD gets, therefore, they couldn't compete on price with BD. Pakistan Government found it easier to devalue Rupees, than to bring economics of scale or better working conditions in to Pakistani products.
In current Government over borrowing, quantitive easing and weak FDI combined have caused the weakening of the Rupees.