Islamabad. Jan 5 , 2024 : Mr. Karim Aziz Malik, Chairman Federation of Pakistan Chamber of Commerce and Industry (FPCCI), Capital Office, Islamabad said that the record high interest rate has made it very difficult for the private sector to get credit from banks for the expansion of existing businesses and make new investments due to which the business activities are suffering badly. He further said that rising interest rates make your business debt more expensive which means more cash required to cover interest costs. Kareem Aziz Malik urged a significant cut in the policy interest rate to help to revive the economy.
He said that current 22% interest rate has severely damaged the business environment without achieving its intended objective of controlling inflation. He said that the bank advances to the private sector have declined to just Rs.208 billion in the financial year 2023 compared to over Rs.1329 billion in the financial year 2022 due to which the GDP of the country has contracted significantly Pakistan must foster private sector-led economic growth. He said that the production of all major industries of large scale manufacturing sector including textile, paper board, iron and steel products, electrical equipment, automobiles and furniture are badly affected and manufacturing activities have been reduced, If this trend continues, it would not be possible for the government to achieve its set growth target, he added.
He urged on a significant cut in the policy interest rate to enable private sector to get affordable credit that would accelerate the pace of business activities and help to revive the economy. He said that lower interest rates for business mean increased production of goods and the creation of new jobs for the people who produce, sell, and deliver the goods.
