Mahmud Sipra: A Wild Idea?

Assume that a hundred million families in Pakistan own a minimum of 3 tolas of gold each. The actual number could be much higher but for this exercise, this will do. Based on today’s price of gold — about Rs 11,000 for every 10 grams — the collective value of this untapped hoard in dollar terms at today’s exchange rate comes to an astronomical 48 billion dollars! I think you might have guessed by now where I’m going with this.

The trick would be to convince these hundred million people to contribute a minuscule portion of their bullion holdings (about 17 measly grams) — for a price, of course — to the cause of saving their country from ruination and humiliation. That figure equates to a staggering 24 billion dollars — more money than Pakistan has ever had in its foreign reserve coffers in its history. This could be done by simply appealing to their sense of national pride and in the ‘sovereign’ interest of their country.

In return, the government could issue a 10-year ‘Resurgent Pakistan Bond’, similar in spirit if not in essence to the Resurgent India Bond issued by the State Bank of India in 1998. It would differ from its Indian cousin in so far as the Indian Bond was aimed at non-resident Indians (NRIs); in Pakistan’s case it would be the reverse. The Bond would target its own burgeoning domestic population.

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