State Bank of Pakistan (SBP) Governor Dr Reza Baqir Monday said the ongoing economic reforms are showing positive results as economy is moving towards improvement. Currently, the exchange rate is stable, exports and foreign exchange reserves are increasing and current account deficit is on decline, he added.
Addressing the business community at Karachi Chamber of Commerce and Industry (KCCI), Baqir said the SBP has always made efforts to facilitate trade and industry as better business environment helps strengthen the economy. During last few months, the SBP has taken a number of steps towards ease of doing business and currently the business environment in Pakistan is much better than previous years, he added.
Recently, the SBP not only increased the limits of export oriented soft loans to boost exports, it also allowed manufacturing sector up to $ 10,000 advance payment for import of spare parts, he maintained.
"Previously, the SBP policies were being criticized but we did our job earnestly and now there are positive results in terms of economic reforms. The exchange rate is stable, SBP's foreign exchange reserves and exports are gradually increasing, imports, trade and current account deficit is on decline," he maintained.
The Governor SBP said that textile industry in Faisalabad is flourishing and foreign investors are investing in Pakistan because of improved business environment. "We are also trying to ease the doing business in Pakistan," he added.
He said the SBP has announced special financing schemes for Small and Medium Enterprises (SMEs) as it believes that SMEs can help get a high GDP growth. Small entrepreneurs can get financing for setting up new businesses at 6 percent through SME financing schemes.
In addition, the SBP has introduced financing schemes for cold storage, working capital, alternate energy and special loans for women entrepreneurs to support the industry.
Replying to a question, the Governor SBP said that, interest rate is the domain of independent monetary policy committee as the committee takes decisions independently after reviewing all economic indicators. "Policy rate is linked with inflation and will be reduced, when inflation will come down. This year the projected inflation stands at 11-12 percent, while currently the policy rate stands at 13.25 percent," he added.
He said the SBP wants to establish banking relations with Iran to promote bilateral trade and is closely monitoring the banking channels set up by other countries, particularly Turkey.
President KCCI Agha Shahab, Siraj Kassim Teli and others also spoke on the occasion.
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