Business community of the Punjab has welcomed 100 basis points cut in the policy interest rate by the State Bank of Pakistan with reservations describing it below expectations. Talking to Business Recorder, here on Sunday Chairman All Pakistan Business Forum (APBF) Nabeel Hashmi said as the government has saved nearly $ 5 billion on the import of oil, it should have reduced the interest rate by at least 200 basic points.
He said the government should increase the share of private sector''s credit, especially for the SMEs, reduced gas and electricity outages to fuel economic activities in the country.
Former Chairman PAAPAM Malik Muhammad Aslam said the government should pass on the benefit of reduced interest rate to the private sector, minimise its own borrowing from the banks, accelerate cash flow and encourage investment in trade and industry.
He said the government should also make concrete efforts for cutting down the power load-shedding so that the industrial production and exports could be increased.
Veteran industrialist, Qaisar Ahmad Sheikh, MNA, Member Standing Committee on Finance, Industry, Planning Commission and FBR Policy Board said that the 100 basis points cut in the interest rate is a proof of the PML-N government''s prudent and visionary of financial management.
He said now more financial resources and cash would be available to the private sector for investment and generation of job opportunities for the unemployed skilled and semi-skilled labour. The cut in interest rate would also attract substantial foreign investment in Pakistan for economic growth.
Chairman PIAF Tahir Javed Malik said that reduction in interest rate would improve the cost of doing business and make Pakistani products competitive in the local and international markets. He demanded that in accordance with the Islamic injections, interest rates should be totally abolished. Credit to the private should be made easy for economic growth, he added.
Chairman Sunder Industrial Welfare Association Mian Faheem Qamar said that the government is the biggest borrower, thus cut in the interest rate would mainly benefit the public sector. Due to acute shortage of energy, both gas and electricity, the private sector in Punjab could not take advantage of the bank''s credits earlier as it has been functioning much below its capacity.
Welcoming the cut in the policy rate, he demanded improvement in the security environment, supply of energy and readily available credit line.
Nadeem Shami, Chairman Pharma FPCCI committee said that the government should make maximum resources and finances available to the SMEs that alone can generate millions of jobs for the unemployed people and boost economic and social stability in the country.
He suggested that the government should drastically cut its borrowing, and improve supply of energy to the industry.