Karachi: President of the Korangi Association of Trade and Industry (KATI) Junaid Naqi expressed
disappointment over the State Bank of Pakistan’s decision to set the policy rate at …. % in its latest
monetary policy announcement. He stated that the policy does not meet expectations, especially given
the current economic conditions. With inflation at its lowest level in years and the rupee showing
stability, the policy rate should have been brought down to single digits to support economic growth.
Junaid Naqi highlighted that the high-interest rates have made it increasingly difficult for industries to
operate efficiently. The elevated cost of production has placed immense pressure on both local
industries and exporters, leading to significant challenges for the business community. He noted that
with the policy rate at …..%, access to working capital remains expensive and challenging for businesses,
severely hindering their operations. The rising cost of borrowing has frozen new investments, bringing
industrial growth to a standstill.
Small and medium enterprises (SMEs), which are considered the backbone of the economy, have been
disproportionately affected by the current policy. According to Naqi, these businesses are facing
declining productivity, rising unemployment, and reduced private sector engagement. He stressed that
the industry had expected a significant reduction in interest rates in the new monetary policy, but the
current rates are likely to further stifle industrial output and discourage new investments.
He warned that the existing policy rate has intensified pressure on the business community and
destabilized the economy. Junaid Naqi urged the government and the State Bank to seriously consider
the concerns of the industrial sector and develop policies that can stimulate economic recovery.
KATI’s president emphasized the need for a business-friendly monetary policy, stating that without
immediate action to lower policy rates, the country’s economy and industrial sector could face long-
term setbacks. He called for urgent measures to ensure sustainable industrial growth and to alleviate
the financial strain on businesses, enabling them to contribute to the country’s economic stability and
development.
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