Lasbela Chamber of Commerce and Industry's (LCCI) President Yakoob A. Karim has said that bank financing for industrial sector was not affordable in the wake of high interest rate in the region. Urging the State Bank of Pakistan to make a drastic cut in the interest rate, ranging between 250 and 300 basis points, in the monetary policy to be announced on Saturday (Nov15) for the next two months, he hoped that a cut in mark-up rates in the ensuing monetary policy would give some breather to the ailing industry.
He pointed out that government itself will have to pay a huge amount as mark-up on the loans which it had acquired during past seven years if the discount rate was not curtailed. The LCCI chief said that unchanged or a cut of mere 50 to 100 basis points would not be helpful for the dwindling economy. "It is very unfortunate that we have failed to learn any lesson from the SBP's tighter monetary policy stance in the past few years", Yakoob said, adding that the present government was pursuing the anti-economy and anti-investment policies of the previous regime.
He said that despite higher inflation, all the major economies have either curtailed or are in the process of reducing high interest rates to protect their economies. He said that the central bank should understand that its continued tighter stance was inflicting a heavy loss to the economy which had already paid a very high price because of high interest rate.
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