Need stressed to reduce interest rate

KARACHI: Sheikh Umar Rehan, the former President of the Korangi Association of Trade and Industry (KATI), has emphasised the critical need for the State Bank to reduce the prevailing high interest rate to single digit, asserting that it is imperative for fostering the growth of the industrial sector.

He expressed concern that the elevated production costs in Pakistan hinder the competitiveness of local products in the global market. Highlighting the adverse impact of high interest rates on the industrialisation, Umar Rehan called for urgent measures to alleviate the cost of establishing new industries.

The economic growth of the country, particularly in the industrial sector, is currently experiencing significant setbacks. Rehan attributed part of this decline to the inhibiting effects of high-interest rates on investments, particularly within the industrial domain.

Addressing the broader challenges faced by industries, he pointed out the rapid escalation of costs associated with establishing new ventures. These challenges include not only high-interest rates but also substantial increases in industrial land prices, soaring energy costs, and various other issues collectively impeding the progress of industrialisation in Pakistan.

Umar Rehan underscored the necessity for immediate actions aimed at reducing production costs and facilitating the establishment of new industries to ensure sustainable development and growth in the country. He expressed disappointment that, despite governmental efforts to discourage imports, insufficient attention has been given to promoting industrialization for export growth.

Emphasising the critical role of industrialisation in providing employment opportunities and addressing rising inflation, he urged the government to re-evaluate its fundamental economic policies. He stressed the importance of revising these policies to align to promote industrial growth, ensuring employment generation, and enhancing the country’s ability to compete globally.

Copyright Business Recorder, 2024