Business community seeks cut in interest rate immediately

KARACHI: Business community has urged the government to intervene and direct the central bank to lower the interest rate immediately.

Ahmed Azeem Alvi, President of the SITE Association of Industry Karachi, has expressed deep disappointment over the State Bank of Pakistan’s decision to maintain the policy rate at 11 percent.

He criticized the move, stating that the repeated demand by the business community to bring the interest rate down to single digits has once again been ignored, causing widespread concern among industrial stakeholders.

Alvi said that while Prime Minister Shehbaz Sharif continues to emphasize the importance of boosting industrial activity — including the recent announcement of a power subsidy package for industries — the bureaucracy appears to be resisting these efforts.

“This is the fourth consecutive time the policy rate has not been reduced, which clearly indicates a lack of alignment with the Prime Minister’s economic vision.”

The SAI president further explained that a reduction in the policy rate would have enabled industrialists to access bank financing for purchasing new machinery, thereby enhancing production and generating employment.

“The current interest rate is discouraging investment and stalling industrial progress,” he added.

He urged the government to intervene and direct the central bank to lower the interest rate immediately.

“Only through a substantial rate cut we can accelerate economic recovery and ease the financial burden on the business community,” Alvi concluded.

President of the North Karachi Association of Trade and Industry (NKATI), Faisal Moiz Khan, has expressed deep disappointment over the State Bank of Pakistan’s decision to maintain the policy rate at 11 percent, describing it as a major setback for the country’s business and industrial sectors.

He said that the business community had repeatedly urged the central bank to bring down the interest rate to single digits in order to stimulate investment and industrial growth.

“The business community had expected that the State Bank would reduce the policy rate by at least two to three percent, but the decision to keep it unchanged is disappointing,” he said.

Faisal Moiz Khan warned that maintaining such a high interest rate could undermine the efforts of Prime Minister Shehbaz Sharif and COAS General Syed Asim Munir to stabilize and strengthen the national economy.

He noted that if the policy rate had been reduced to single digits, industrialists could have obtained bank financing to purchase new machinery, leading to higher industrial production and job creation. Instead, he said, the high cost of borrowing has stalled new investments and slowed industrial growth.

Copyright Business Recorder, 2025