PIAF for 200 bps cut in policy rate

Pakistan Industrial and Trader Associations Front (PIAF) on Monday called for 200 basis points (BPS) cut in policy rate likely to be announced on Wednesday (tomorrow). Addressing the PIAF Parliamentary Committee, here on Monday, Chairman PIAF Sohail Lashari said the cut in policy rate to bring it to single digit was prerequisite to expedite process of industrialisation in the country, jack up the graph employment and ensure manufacturing sector growth. He said the sluggish economy was not only creating social problems.
If the business community is ensured low cost equity, the country would witness a boom in trade and industrial activities as high cost of doing business was not only keeping the foreign businessmen away while also discouraging the local investors, he said. In all the leading economies the rate of industrial mark up was very low than Pakistan, he added. The PIAF chairman said that these countries, despite having high inflation rate, were keeping the mark-up rate at lower side for the reason of facilitating the trade and industry. The State Bank of Pakistan (SBP) must learn some lesson from the economists in the developed countries and bring down the policy rate to single digit.
He said that the challenges presently being faced by country included an acute shortage of gas, electricity, highest ever power tariff, lack of proper infrastructure, fast widening fiscal deficit and bad governance. The private sector must be facilitated to overcome these challenges, he added. Lashari said that central bank had adopted a tougher monetary policy stance to keep the inflation low but failed to achieve desired and required results therefore it would be wiser on the part of the SBP to give importance to questions of the private sector. Former Chairman PIAF Mian Anjum Nisar, President LCCI Irfan Qaiser Sheikh and former Senior Vice President LCCI Sheikh Mohammad Arshad were prominent among the speakers who also condemned Nato's naked aggression against Pakistani forces.