Taliban ban use of Pakistani currency in Afghanistan, transactions over 500,000 rupees

The Taliban administration has reportedly banned the use of Pakistani currency, the rupee, in the country. According to news agency Khaama Press, the Taliban Intelligence Agency’s Anti-Money Laundering Branch has ordered the Association of Money Exchange Dealers in a letter to “completely ban” the use of Pakistani Rupees in financial transactions in Afghanistan

The letter states that all financial transactions, including but not limited to transfers, trade, and currency exchange, are disallowed, the news agency reported.

The move would deal a major blow to the locals and traders who use Pakistani Rupees for everyday spending and food purchases.

Apart from that, the money exchange dealers have been banned from conducting transactions totalling more than 500,000 rupees.

“If more than the specified amount is discovered, the dealers could face legal action,” the letter stated.

Afghanistan’s economy has been in tatters ever since the Taliban stormed back to power last year.

The World Bank and the International Monetary Fund have predicted a contraction of the economy by a further one-third by the end of 2022.

According to the United Nations, half of the country’s 39 million people need humanitarian assistance.

To make matters worse, the US froze nearly $9.5 billion in assets belonging to the Afghan central bank and stopped shipments of cash to the nation.

Of the total amount, only $3.5 billion was released by the Biden administration which has established a foundation to spend that amount to benefit Afghans.

The trust, which is based in Switzerland, will use the money to help address the unfolding economic and humanitarian crisis in Afghanistan — while keeping the funds out of the hands of the Taliban.

(With inputs from agencies)