The Rawalpindi Chamber of Commerce & Industry (RCCI) on Friday expressed strong reservations over an increase of 150 basis points in the interest rate by the State Bank of Pakistan, taking it from 7.25 percent to 8.75 percent.
In a statement, President RCCI Nadeem Rauf urged the government to withdraw the hike as it would increase the credit cost of commercial banks, ultimately casting a bad impact on the growth of industrial activities and creating more hardships for the Small and Medium Enterprise (SME).
He said the central bank raised its interest rate by a sharp 150 basis points in one go which would discourage the investors considering Pakistan for investment.
Nadeem Rauf said Pakistan needed a quick revival of business and industrial activities to improve the economy which was badly hit by COVID-19. He underlined that the increased interest rate would make the cost of credit unaffordable for the business community.
The RCCI chief observed that the government was already facing pressure on the fiscal deficit. He said the increase in interest rate would heighten the budget deficit. He urged Advisor on Finance Shaukat Tarin to review the SBP announcement and hold a meeting with the business leaders to discuss and devise a new strategy to strengthen the economy.