KARACHI: Pakistan’s renowned industrialist and United Business Group (UBG) leader, Farhan Hanif, has urged the governor of the State Bank to reduce the policy rate to 10% in line with inflation.

He sought the announcement of a 400 basis points cut in the interest rate during the upcoming Monetary Policy meeting scheduled for September 12.

Farhan Hanif emphasized that he stands as the strong voice of UBG’s leader and patron-in-chief, S M Tanveer, in demanding a 4% reduction in the interest rate.

Farhan Hanif highlighted that in comparison to Pakistan, the policy rate is 8.50% in Bangladesh and 6.50% in India. Pakistan’s significantly higher policy rate puts exporters at a competitive disadvantage.

To make Pakistani exporters more competitive, a reduction in the policy rate is essential. The government must lower production costs to boost exports, allowing the country to reap the benefits of international trade. However, this will only be possible if the interest rate is immediately reduced by 4% and eventually brought down to single digits.

Copyright Business Recorder, 2024