ICCI demands cut in SBP interest rate to revive economic activities

Islamabad: The current leader of the Islamabad Chamber of Commerce & Industry (ICCI) has described the 20 percent benchmark interest rate in Pakistan, highest in the Asia, a major hurdle in promoting trade and industrial activities in the country and urged that the SBP should make significant cut in interest rate to revive the businesses and economy.

Addressing a reception hosted for the capital’s estate agents, Zafar Bakhtawari, said the interest rate in China is 3.65%, Bangladesh 6%, India 6.5% but in Pakistan it is 20%, which is highest in the whole Asian region. He wondered how the Pakistani businesses could compete with regional competitors for exports with the highest interest rate.

Bakhtawari said the historic hike in interest rate has made the credit cost unaffordable for the private sector due to which business and investment activities are badly suffering. He stressed that the government should address the concerns of the business community on high interest rate and high taxes on the construction sector to ease their problems.

Speaking at the occasion, Sardar Tahir, President, Islamabad Estate Agents Association said that the construction industry is the backbone of the economy as its growth boosts the business activities of over 70 allied industries. However, the construction industry is in big trouble these days due to high interest rate, higher taxes and devaluation of the rupee. He stressed that the Finance Minister Ishaq Dar should hold a meeting with the business community of the construction industry to listen to their genuine issues and take urgent remedial measures to revive the economy. Zafar Bakhawari, former President ICCI said that Pakistan is facing a serious issue of foreign exchange reserves due to which imports are banned and said that the best option for Pakistan to improve forex reserves is to boost exports on an urgent basis. He said that for this purpose, it is essential that the government should promote ease of doing business by reducing the cost of doing business.

Sardar Yasir Ilyas Khan, former President ICCI said that the government’s policy of increasing interest rate to control inflation has failed miserably.