Traders and industrialist alike have rejected the decision of State Bank of Pakistan to revise interest rate upward to 14 percent and termed the decision as anti-economy move.
Business community on Wednesday expressed its deep anxiety over the half percent increase in interest rate and said that the business community is already facing enormous problems including gas shortage, high gas and power tariff, bad law and order condition, high cost of manufacturing and now further increase in interest rate.
The industrialists are of the view that SBP should curtail the key rate by at least two percent. They pleaded that Pakistan has higher interest rates as compared to its neighbouring countries. In Pakistan interest rates reached at 14 percent whereas in Bangladesh it is 10 percent and in India it is 8 percent.
They further expressed that nothing was going in the favour of business community; the industrialists were frequently demanding to bring it to a single digit. They said that the non-performing loans have already reached over Rs 500 billion and the recent move by SBP would further increase the financial burden over the national exchequer.
Chairman Federal B Area Association of Trade and Industry (FBATI) Mohammad Irfan said that increase in interest rate; Afghan Transit Trade and Reformed General Sales Tax (RGST) would have numerous impacts on industrial cost of production. He advised government to take well calculative steps in consultation with business community to save industry from collapse.
Chairman, Pakistan Chemicals and Dyes Merchant Association (PCDMA), Haroon Agar expressed serious concern on monitory policy announced recently and said that it will slowdown business and industrial activities. Haroon Agar said that the business community faces enormous difficulties to keep their business and industrial activities running under prevailing situation. He said that the government had promised to bring interest rate to single digit, which remain unfulfilled.
Haroon Agar said prices of imported goods are already on rise owing to decline in rupee value and prices will further increase after recent hike in interest rate. Former Chairman Korangi Association of Trade and Industry (KATI), Shaikh Manzar Alam said that industrial production already going down and this increase would further aggravate the situation.
He criticised the political parties saying that PMLQ had boycotted senate session just to get the bill adopted. It is a well-planned move of PMLQ, he added. He advised leaders of political parties to take decisions keeping national interest in mind. Manzar Alam termed the increase in discount rate "alarming" which will enhance the economic adversity.