A high key rate to ruin trade and industry: the head of the ISC – Business & Finance
KARACHI: Stressing that interest rates in Pakistan are the highest in the region, Chairman of the Site Association of Industry (SAI), Karachi, Abdul Rashid urged the Governor of the State Bank of Pakistan (SBP), Dr. Reza Baqir, to immediately withdraw the recent 2.5% policy rate hike.
The head of the ISC on Saturday called for the decision to be reviewed in the best interests of the economy so that trade and industry can be saved from collapse. The country needed stability in the current political crisis.
He said the central bank’s decision to raise the policy rate by 2.5% had caused serious concerns among members of the business community and they feared that such reckless decisions could ruin trade as well as the industry.
The ISC President said that after the devastating effects of the Covid-19 pandemic, it was very difficult for trade and industry to get back on their feet, but the recklessness of policymakers and the anti- businesses and anti-trade government agencies had once again jeopardized the survival of businesses and industries.
Mr Rashid said the continued devaluation of the rupiah had dramatically increased the cost of raw materials and now, with interest rates at an all-time high of 12.25%, the cost of production would rise to unsustainable levels.
He asked the SBP governor to reconsider the decision to raise interest rates in the best interest of the economy, to adopt a strategy of gradually reducing interest rates to single digits and also to avoid to impose new burdens on commerce and industry.
He was of the opinion that in the current political situation and economic crises, the country could not afford anti-economic measures.
Copyright Business Recorder, 2022