FPCCI criticises hike in interest rate

KARACHI: Dr. Mirza Ikhtiar Baig Senior Vice President FPCCI and Convener FPCCI standing committee on Banking, Credit and Finance criticized the further hike in SBP policy rate by 100 basis point to 13.2%.

Baig said, in his recent meeting with the Prime Minister Imran Khan in Karachi, he informed the PM that FPCCI don’t agree with the SBP policy for containing inflation by increasing the SBP policy rates. He said it will further increase lending rates of the banks to 15% to 16% and would increase financial cost discouraging new investment and economic growth in the country. Dr. Baig said due to increase in SBP discount rate, the lending rates of the banks have been doubled and feared increase in Non Performing Loans and closure of industries which will create unemployment in the country

IMF in its recent report projected 14% SBP policy rate and SBP monitory policy following IMF direction which will give adverse effects to new industrialization and job creation in the country. He said due to higher markups and financial cost, there is also reduction in private sector credit which will further slump the economic growth and activities.