KARACHI: Ahmed Azeem Alvi, President of the SITE Association of Industry Karachi, has called the State Bank of Pakistan’s reduction in interest rates by only 200 basis points (2%) disappointing. Despite demands from the business community, he has called for a reduction of 500 basis points (5%).
In a statement, the President of the SITE Association emphasized that, given the continuous decline in inflation, bringing the interest rate to only 13% will not have a significantly positive impact on the economy and industry. However, he stated that adopting a strategy to bring the interest rate to single digits would certainly accelerate economic activities, increase borrowing from banks, and encourage the expansion of existing industries as well as the establishment of new ones.
Ahmed Azeem Alvi said, “On the one hand, the government is encouraging business expansion and the establishment of new industries, but on the other hand, serious steps are not being taken to reduce business costs, which is causing difficulties for the business community.”
He further explained that due to high interest rates, expensive electricity and gas, and numerous taxes, setting up new industries—or even maintaining existing ones—has become extremely difficult. “If the government truly wants to put the country on the path of economic development, it should implement industry-friendly measures and consult stakeholders before making any decisions. This would help restore the confidence of the industrial community, enabling them to contribute more effectively to economic growth.”
The SAI Chief reiterated his long-standing demand to the State Bank of Pakistan, urging that, as inflation continues to decrease on a monthly basis, the central bank should convene a meeting of the Monetary Policy Committee every 15 days. He called for a reduction in the interest rate to single digits, which would be warmly welcomed by the business community and would create vast employment opportunities through the establishment of new industries.
