KARACHI: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has strongly criticized the State Bank of Pakistan’s (SBP) decision to keep the policy interest rate unchanged at 11.5 percent, arguing that the move will negatively impact businesses, investment, exports, and industrial growth.
The criticism came after the SBP’s Monetary Policy Committee announced its latest policy decision, opting to maintain the benchmark interest rate instead of reducing it. Business leaders had widely expected a rate cut to provide relief to the country’s struggling industrial and commercial sectors.
In a statement issued following the announcement, FPCCI Acting President Saquib Fayyaz Magoon described the decision as “contractionary,” saying it failed to address the financial challenges currently facing businesses across Pakistan.
Magoon said manufacturers and exporters continue to face mounting pressure due to high borrowing costs and elevated energy tariffs, making it increasingly difficult for local industries to remain competitive in international markets.
He stressed that reducing the policy rate to a single-digit level has become essential to lower production costs, improve access to affordable financing, reduce the prices of goods and services, and stimulate economic activity.
Echoing these concerns, FPCCI Vice President and Regional Chairman Sindh Abdul Mohamin Khan said that with core inflation showing signs of stability, maintaining a high policy rate places an unnecessary burden on the business community.
He warned that expensive financing continues to discourage private-sector investment, contributes to industrial closures, and weakens the competitiveness of Pakistani exporters in global markets.
The FPCCI urged the central bank to provide a clear roadmap for gradually reducing interest rates and aligning monetary policy with the needs of the business sector. It also cautioned that without a transition to a single-digit policy rate, Pakistan may struggle to achieve its export and industrial growth targets during the current fiscal year.
The business community has repeatedly called on policymakers to adopt measures that encourage investment, boost industrial production, and improve economic growth amid easing inflationary pressures.
