RE - Trade leaders and industrialists on Thursday blasted the State Bank of Pakistan (SBP) for enhancing two per cent interest rate, terming it as a cruel step which would badly affect the economic growth in the country.
They said that the industrial survival has been put at the stake with a single stroke of pen and it would have been better if curbs had been paced on unnecessary imports and on the expenditures of the government.
They said that the increase in interest rates would not only hit all the industrial sectors including Sugar, textile, plastic, steel but it would put a very negative impact on the agriculture sector, which is the backbone of the country's economy.
However, the Acting President of Pakistan Mohammadmian Soomro has assured the business community that he would take up the issue of recent hike in interest rates with the Governor State Bank of Pakistan.
The Acting President Mohammadmian Soomro stated this while talking to a delegation of the Lahore Chamber of Commerce and Industry, headed by Acting President Mian Muzaffar Ali at his Lahore residence on Thursday.
LCCI Vice President Shafqat Saeed Piracha, former President Mian Misbahur Rehman, former Senior Vice President Sohail Lashari and Executive Committee member Ghulam Sarwar Malik were also present on the occasion.
Mohammadmian Soomro said that the present government was quite aware of the problems of the business community due to ongoing global financial crunch and was evolving a solid strategy to come out of this mire that has now started taking its toll on the common man.
Mohammamian Soomro, who himself is a banker, said that he knew well the industrial sector was under tremendous pressure and some relief should be given to it and the government was spending all its energies in this direction.
The LCCI Acting President Mian Muzaffar Ali informed Mohammadmian Soomro that the economic managers in Pakistan have no exposure to the norms in vogue in the rest of the world where the interest rates are being decreased to facilitate the businesses but we are blindly acting on same old methodology of increasing the interest rates to cut inflation.
He said that at the moment the government itself is the biggest borrower and raise in interest rate would further squeeze liquidity. Mian Muzaffar Ali said that the industry was already passing through very critical times of its history due to high cost of doing business, shortage of energy and devaluation of rupee value and at the very outset increase in discount rates is unjustified.
Meanwhile, talking to The Nation Chairman Pakistan Industrial and Traders Association Front (PIAF) Irfan Qaiser said that the increase in interest rate would hit hard the entire economy. He said that the increase in interest rate would halt industrialist sector, already under pressure due to the alarming increase in the prices of gas, electricity and fuel.
"It seemed that the government is not serious as fare as economic growth of the country in concerned. This increase will lead to closure of small and medium industrial units," he added.
Trade leader Irfan Iqbal Sheikh said that the increase in interest would multiply the miseries of the industrial sector. He urged the government to intervene into the situation and force the State Bank to take back anti-economy decision.
Chairman Auto Exporters Association Pakistan Tahir Javed Malik said that the business community was expecting decrease in interest rate by the SBP. "The entire industry is already suffering a lot due to high mark-up and this increase will push the businessmen to close down their business," he added.