KARACHI: Pakistan Yarn Merchants Association (PYMA) on Thursday termed the significant three per cent hike in policy rate to 20 per cent as disastrous for industries, especially the SMEs.
The association expressed deep concern over the sudden three per cent increase in interest rates by the State Bank of Pakistan on the advice of the IMF.
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In a statement, PYMA Senior Vice Chairman Sohail Nisar said that the State Bank of Pakistan has increased the interest rate by 300 basis points, after which the interest rate has reached a high level of 20 per cent, which is unsustainable. As a result of this move, SMEs including industries will face severe shortage of capital.
“This is the highest level of interest rate in the country since October 1996, while the State Bank has increased the interest rate by 1050 basis points since January 2022, which is not in favor of the economy, business and industry.”
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Sohail Nisar was of the view that the central bank should go for other strategies instead of increasing the interest rate to control inflation and make it easy and affordable to get loans for business and industry so that the industries get a boost and more employment can be created.
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PYMA Senior Vice Chairman requested the Prime Minister Shehbaz Sharif and Governor State Bank of Pakistan to avoid harsh economic measures to save the already sinking country’s economy, business and industry and to save the economy from being destroyed by the serious effects of high interest rates and withdraw the decision to increase the interest rate.
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Otherwise business and industry will face severe shortage of capital and discourage new industries.
