Islamabad, Jan 24: The President of the SITE Association of Industry Karachi, Ahmed Azeem Alvi, has called for reducing the policy rate to a single digit in light of the decrease in inflation. He emphasized that providing loans at lower rates is crucial for industries to establish a presence in international markets.
He stated that the State Bank of Pakistan should seriously consider this demand in the country’s best economic interests, so that the industrial community can effectively address issues such as high production costs and other financial challenges.
In a statement released on Friday, the SITE president stated that the current 13% rate is still too high. There is still significant room for reduction, as inflation continues to decrease.
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Despite this, it is incomprehensible that the State Bank has not lowered the policy rate to a single digit. Ahmed Azeem Alvi added that their demand is for a 5% reduction in the policy rate, as gradually lowering it would have positive effects on the national economy.
This would also lead to an increase in the trend of borrowing from banks, help address the capital shortage, and significantly aid in restoring industrial activities to their normal pace.
Mr. Alvi added that reducing the policy rate would have a positive impact on the national economy, increase borrowing from banks, and help alleviate the capital shortage. He also suggested that the State Bank convene a monetary policy committee meeting every 15 days to review the inflation rate and take steps to reduce the interest rate to a single digit.
The business community would welcome such a move, as they are currently unable to borrow at high interest rates due to the severe economic crisis and rising production costs.
