KARACHI: Chairman of National Business Group Pakistan and President Pakistan Businessmen and Intellectuals Forum Mian Zahid Hussain has said interest rates in Pakistan were already higher than other countries in the region and they are more than double in comparison to India and some other countries.
Inflation is also higher than in many countries of the region due to wrong policies of economic managers, he said.
Mian Zahid Hussain said that the SBP has tried to stem the fall of rupee and eliminate market uncertainty by unprecedented hike in interest rate but it may not achieve the desired results as our economy is in a deep mess.
He said that the rupee has lost its value rapidly; the US dollar that was available for Rs152 in May is now being traded at Rs175 for which the ‘credit’ goes to the economic managers.
He said that one hundred economists had estimated a maximum increase of one percent in the interest rate during a survey before the monetary policy announcement, which proved to be wrong and it was actually raised by one hundred and fifty basis points.
A good part of the disgruntled business community believes that the central bank is carrying out the IMF agenda regardless of ground realities which is proving fatal to the people and the economy.
Mian Zahid Hussain said that the rupee is bearing the brunt of the mistakes of the authorities. He said their measures will promote hunger, unemployment and result in reduced revenue as scarcity of gas and its high cost will drag the GDP down.
The decision will increase the cost of doing business and jack up production costs of key crops, which will further worsen the food security, while lending to private sector will be dealt a mighty blow which will clip investment.
He said that long as the SBP has the tasks of ensuring economic growth and reducing inflation, it will not be able to do its job as these two goals are contradictory in their nature.
Copyright Business Recorder, 2021