Business community has strongly demanded that the State Bank of Pakistan should bring down the mark up rate to single digit in the national interest, because high mark up rates are yielding negative impact over investment, industrialisation and national exports.
Commenting over the new Monetary Policy announced by the State Bank of Pakistan, Ch Salamat Ali, ex-chairman, and Chief Co-ordinator, Pakistan Hosiery Manufacturers and Exporters Association (PHMA) North Zone hailed the SBP decision to slash discount rate by 150 basis points to 10.5 percent from 12 percent and said this step is realistic support to investment, industrialisation and national exports of the country, but there is need to restore the GDP rate.
He said that the prolonged energy crisis and high mark up rates had badly hit industrial and export growth during the four year. Present relief is not enough to put the Value Added Textile Industry back on the track, he added and demanded the high mark up rate should be brought down to single digit as per given by our neighbour countries. High mark up rate and less availability of cheaper credit for the private sector especially for setting up & running industrial units or reviving sick industrial units are hindering the future investment, he pointed out. Ch. Salamat Ali said that there is a global phenomenon that industry is given top priority whereas in Pakistan it comes to the least and other sectors are given priority. He urged the government to remove all obstacles including energy crisis for promotion of the textile industry and provide further relief by reduction mark up rate in single digit.
Considering the current economic slowdown, the SBP made a cut in the discount rate which was highly appreciative, he added. Cut in discount rate was longstanding demand of textile exporters to enhance the production, which was badly affected by various reasons, including high discount rate, he mentioned.