Industry expresses dismay over monetary policy

KARACHI: The trade and industry Saturday expressed concerns over the monetary policy, announced by the Governor State Bank of Pakistan. The Patron In-chief, Korangi Association of Trade and Industry (KATI), S M Muneer, Chairman, Syed Johar Ali Qandhari said that the central bank has finally decided not to make an unrealistic move to keep on increasing discount rates “which was resulting in mounting NPLs (non-performing loans).” They said that it is the need of the hour to reduce and gradually bring the interest rate down to single-digit but SBP has maintained the 14 percent bank rate without any justification. They further said that interest rate is highest in Pakistan as compared to the rest of the world and the exporters have become uncompetitive in export market due to massive overheads. President Pakistan Businessmen and Intellectuals Forum and Chairman, FPCCI Standing Committee, Mian Zahid Husain has termed the SBP’s decision as anti-industry and anti-economy.

He pointed out that even SBP Governor himself admitted that government could not achieve any monetary goal by increasing discount rate yet he has failed to realise that highest bank rate prevailing in the country is resulting in a mass number of defaulters. He informed that over several hundred cases of NPLs are pending before the courts and the number of defaulters is feared to increase further. Mian Zahid said that as the SBP chief has realised the grim situation and ever-increasing inflation due to faulty Monetary Policy — he should bring down discount rate to the level of June 2010 without further delay in order to rescue economy, which is deteriorating fast. Chairman Pakistan Tanners Association, Aziz Ahmed while expressing reservations over the SBP decision to retain discount rate said that SBP governor has failed to realise that not only NPLs are increasing rapidly but also inflation is playing havoc with the national economy – Dailytimes