President Pakistan Businessmen and Intellectuals Forum (PBIF), Mian Zahid Hussain has said the economy is getting better. Therefore, the central bank should consider reducing the interest rates to trigger growth.
The policy rate has become a hurdle in the development and it is choking the economic activities, he said. Mian Zahid Hussain said that policy rate is 13.25 percent so that the banks are giving loans at above 17 percent interest rate which has made business impossible.
He noted that high interest rates are leading to high rates of defaults of businesses which has also resulted in concerns among bankers.
He said that banks prefer investing in government papers where profit is good and investment is safe which is good for both parties but it is hampering economic activities.
He said the dependence of the government on banks continue to increase which will prove damaging for the economy as the private sector would be crowded out.
Copyright Business Recorder, 2019
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