KARACHI: The Association of Builders and Developers of Pakistan (ABAD) has called on the federal government and the State Bank of Pakistan (SBP) to reduce the interest rate to 9% to stimulate economic growth, increase investment, and revive the struggling construction and housing sectors.
ABAD Chairman Mohammad Hassan Bakhsh said that the current 11% interest rate is crippling business activity across the country, blocking private investment, and causing economic stagnation.
He further said that if reforms are not made in the monetary policy, Pakistan could face severe consequences, including prolonged recession, rising unemployment, and a decline in industrial production.
Bakhsh said that the government should reduce the interest rate to single digits in the upcoming monetary policy announcement on July 30, adding that while economies worldwide are lowering interest rates to boost growth, Pakistan’s economy is being strangled by an unrealistic monetary policy that is destroying local industry.
The construction industry, which provides employment to millions and supports over 100 allied industries, cannot survive under the current interest rate regime, Bakhsh said and added that reducing the interest rate would unlock private investment, make housing finance more affordable, and create economic activity across various sectors.
“If Pakistan wants to compete regionally and attract investment, it must align its financial and economic policies with ground realities,” Bakhsh said.
Copyright Business Recorder, 2025
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