Pak asked to cut interest rates to spur growth


Tariq Mehmood, Director Pak-UK Business Council and Chairman FPCCI Committee on Health has asked the government to cut interest rates in the upcoming SBP review to spur growth.
Economy is showing positive signs while inflation has hit lowest level in five and a half years which supports the demand for cut in rate to boost economy, he said.
He said that holding policy rate in upcoming review by the SBP may not help recent recovery in some critical industrial and agricultural sectors.
Inflation has dropped to pre-2008 economic crisis level due to multiple factors including improved food supply and trade liberalisation with India which should be a wakeup call for critics, said Tariq Mehmood who is also former president Attock Chamber of Commerce.
He said that in a recent interaction with business community, VP CACCI and former President of FPCCI as well as Saarc CCI Tariq Sayeed said that steps should be taken to block return of double-digit inflation.
The economy will revive at fast pace if the SBP eases its monetary policy to offer effective lending rates for business community which will boost private sector demand for bank credit, Tariq Sayeed observed.
A decline in the government borrowing will push the banks to lend more to the private sector ensuring revival of industrial output and economic growth, he quoted seasoned business leader Sayeed as saying.
Tariq Sayeed further said that banks have started lending more to private sector and trend can only be sustained in case interest rates are slashed in mid-December.
At the occasion, Tariq Mehmood lauded the role of Sayeed in bringing Saarc countries closer and focusing on China for enhanced trade.
A pro-growth policy would help government reduce borrowing, cut domestic debt servicing cost and boost developmental spending, he said.
Tariq Mehmood said that liberalised trade with India, as envisioned by our leaders, will not only reduce inflation and create stability but also benefit majority of the world’s population living in the region.


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