Group leader of All Pakistan Textile Mills Association (APTMA) Gohar Ejaz said on Saturday that State Bank of Pakistan (SBP) was not only compromising with but also sacrificing industrial growth by keeping interest rate high in its monetary policy.
Reacting to SBP Monetary Policy Statement for last quarter 2011-12, he said, it was further hitting the public sector development of the country and there is an immediate need to bring the policy rate down to 900 basis points. He said the government was taking the hit of Rs 360 billion under the circular debt, which could easily be met with jacking up revenue generation through reduction in interest rate.
Gohar said NPLs has risen to 31 percent, which is likely to reach to 40 percent by the end of current quarter due to unprecedented energy crisis. He said the SBP, has itself, admitted that the government was a major borrower of the bank loans, which means the private sector was at the lower ebb on attaining new loans. Therefore, the Consumer Price Index (CPI) weight becomes irrelevant in the face of over borrowing from the public sector. He said the energy crisis was incapacitating the industry further, which would hit the exports and impact the job creation capacity of the industry ahead.
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