The Rawalpindi Chamber of Commerce and Industry (RCCI) on Friday expressed reservations over the increase of 100 basis points in the interest rate by the State Bank of Pakistan (SBP).
RCCI Acting President Hamza Sarosh urged the government to withdraw the hike as it would increase the credit cost of commercial banks and ultimately have a bad effect on the growth of industrial activities and create more difficulties for small and medium enterprises (SMEs).
He said that the business community was expecting that the interest rate would be reduced so that the wheel of the economy could keep turning.
Sarosh said that economic activities are already at a standstill and demand is low, so there is no logic in increasing the interest rate. Due to high gas, electricity, and other tariffs, manufacturers are facing difficulties in meeting external orders, he added.
He said Pakistan needs a quick revival of business and industrial activities to improve the ailing economy but the latest increase in interest rate would make the cost of credit unaffordable and badly affect efforts for promoting business activities.
The president urged the central bank to withdraw the hike and bring the interest rate to a single-digit level to encourage new investments.