Lahore, June 06, 2012 (PPI-OT): As the State Bank of Pakistan is going to announce Monetary Policy on Friday (tomorrow), the Lahore Chamber of Commerce and Industry Wednesday urged the SBP Governor to make a cut of 150 to 200 basis points in the policy rate and bring it to single digit for the sake of revival of businesses, overcome low-growth scenario, encourage new investments and give a jumpstart to the sluggish economy.
In a statement issued here, the LCCI President Irfan Qaiser Sheikh said that the availability of cheaper money to the business doing people is a must to bring down the cost of doing business in Pakistan and expedite the process of industrialization that would ultimately result in curtailing poverty, inflation and help in much-needed job creation.
The LCCI President said that Interest rate in the United States is 0.25 per cent, in UK 0.5 per cent, in Canada 1 per cent, in Australia 3.5 per cent, in Japan 0 per cent, in China 6.56 per cent, in India 8 per cent, in Sri Lanka 7.75 per cent and in Bangladesh 7.75 per cent.
The LCCI President said that how Pakistani merchandise could get a respectable place in the international market in the presence of such a high mark up that neither has a parallel in the developed world nor in the region.
The LCCI President said that ongoing economic scenario shows that there is hardly any time left for economic managers of the country to help stop industrial closures and defaults therefore the people sitting at the helm of affairs in the government and the State Bank of Pakistan should understand well that a cut in interest rate would be a great favour to the economy.
The LCCI President said that the economic meltdown in recent years had already proved that high policy rate had caused a great harm to economy and would continue to widen the fiscal deficit unless and until a realistic approach towards this very important area is adopted.
Irfan Qaiser Sheikh said that all the major economies despite having higher inflation rates have either curtailed or are in the process of reducing interest rates to protect their respective economies. He said that the State Bank of Pakistan should understand that its continued tighter stance is inflicting a very heavy loss on the nation as the economy has already paid a very high price because of high interest rate.
For more information, contact:
Lahore Chamber of Commerce and Industry (LCCI)
Lahore -54000, Pakistan
Tel: +9242 111 222 499
Fax: +92 42 636 8854