KARACHI: Leaders and members of UBG SM Muneer and Zubair Tufail have urged the prime minister to review the decision of the State Bank of Pakistan (SBP) to increase the interest rate which has been widely criticized and condemned by the business community across the country as it has caused a great deal of anxiety and concern in business circles.

They further commented that Pakistan’s economy is already confronted with many challenges including dwindling foreign direct investment, growing fiscal imbalances, rising inflation, sharp currency devaluation, and unbearable foreign debt and depleting foreign exchange reserve.

The adverse abrupt decision of SBP to make a steep hike of 2.5 percent in benchmark interest rate taking it to 12.25 pc is a harsh measure badly affecting the business activities of all sectors particularly it would hurt the export, UBG added.

While comparing Pakistan policy rate with the other countries of the region, UBG said the policy interest rate was 4.75 in Bangladesh, 3.7 pc in China, 4 pc in India, 0.75 pc in Hong Kong, 0.5 percent in Thailand while in Pakistan it is 12.25 pc which is the highest in the region. The recent massive hike in the policy rate would adversely affect all sectors of the economy and lead sharp downfall in all business activities.

If the massive hike in the policy rate is not revisited and withdrawn this irrational increase will prove disastrous for the economy and lead sharp downfall in all business activities in all sectors of the economy.

Copyright Business Recorder, 2022