KARACHI: Mian Nasser Hyatt Maggo, President FPCCI, leading a delegation called on Dr Reza Baqir, Governor State Bank of Pakistan (SBP) and discussed threadbare the issues faced by the business, industry and trade community of Pakistan at the hands of commercial banks and detrimental effects of higher policy interest rate.
Maggo said that the policy interest rate must not be over 6% and if SBP wants to promote business activities and economic growth in the country, it should be brought down to 5%. He also pointed out that policy interest rate in the region is 3-4% only and we have to compete with the region. He added that SBP’s TERF scheme has totally ignored SMEs and only few well-established industries were supported.
He emphasized to put limitations on T-Bills and regulating commercial banks for making more lending capacity spared for business and industry.
Mian Anjum Nisar, immediate Past President of FPCCI, said that SBP should create better and efficient linkages with the business community as he feels that SBP is not fully aware of the issues hampering business growth.
Nasir Khan, VP FPCCI, expressed his concerns over lack of support for export industry and dismal numbers for border trade as compared to the potential. He pointed out that many countries in the world have 75% share of border trade in their total exports.
Dr. Reza Baqir assured FPCCI delegation of SBP’s full support and explained the programs and tangible steps that SBP has taken to promote business and economic growth.
He said that policy rate has been brought down to 7% from 13% and foreign exchange reserves have been increased by $10bn over a period of 2 years and these facts should give confidence to the business community vis-à-vis economic stability.
Dr. Reza Baqir said that SBP wants to give confidence to the business community and at the same time achieve sustainable growth in exports and GDP growth.
He added that Rs. 150bn have already been disbursed under the TERF scheme and a total of Rs. 560bn will be disbursed and SBP will have more consultations with FPCCI and their recommendations will be taken into account.
Dr. Baqir said that SBP will issue licenses to digital banks and will also regulate conventional commercial banks to implement SBP’s digitization programs. He said that in total Rs. 2000 bn will be utilized by the Government of Pakistan to offset the impact of COVID-19 on Pakistan’s economy.
Seema Kamil, Deputy Governor SBP, said that many more financial digitization programs will be launched in a phased and sustainable manner, for example Raast Bulk, P2P Transactions and P2M Transactions.
Lubna Bhayat, Convener Central Standing Committee of FPCCI on Banking and Credit Management, said that the business community is ready to invest in FinTech as this is the future of banking industry.
FPCCI thanks Dr. Reza Baqir and the management of SBP for the high-profile event and the warm reception. FPCCI is looking forward to take the consultations forward for tangible gains.
Copyright Business Recorder, 2021