LAHORE: All Pakistan Business Forum (APBF) on Sunday urged State Bank of Pakistan (SBP) to review its policies to facilitate private sector because credit off-take in fiscal year 2018-19 has fallen to Rs 607.5 billion against Rs 618.2 billion of last year due to high key policy rates.

APBF President Syed Maaz Mahmood said in a media statement that a low volume of private sector credit off-take means low domestic investment, business activity and economic growth as well as rising unemployment in the country.

He added that off-take at the beginning of last financial year was much higher than the preceding year, citing that economic situation with higher rates discouraged private sector from borrowing additional funds during the later months, while the central bank had justified policy rate hikes throughout the fiscal year terming it was due to rising inflationary pressures.

With weaknesses in private capital inflows continue to persist, he suggested, the Central Bank should cut policy rates to spur growth, as it would infuse confidence in the business community and propel economy.

Syed Maaz Mahood mentioned that industry was expecting the cut in interest rate, which could help boost private sector growth.

He also complained that lending to private sector by the commercial banks during the current fiscal year had not picked up pace.

He also called for supporting large scale manufacturing and credit to the private sector to stop flight of capital, improve tax machinery and curb speculation of different sectors.

Copyright APP (Associated Press of Pakistan), 2019