ICCI hails cut in policy rate by 150 basis points

  • August 11, 2012
Islamabad Chamber of Commerce and Industry (ICCI) welcomed the Government decision of reducing the mark up rate by 150 basis points. However, rate cut to a single digit could provide greater relief to industries and exporters under the prevailing economic situation.
 
This step was need of the hour and an imperative move towards the revival of the economy and the industry. It was stated by Yassar Sakhi Butt, President ICCI while commenting upon the declining of mark-up rate by 1.50 percent to 10.50 percent by State Bank of Pakistan.
 
He lauded the Government decision to balance inflation and growth considerations through the expansionary monetary policy because tight monetary policy was not appropriate solution to economic problems. 
 
ICCI President was of the view that the availability of cheaper money to the business doing people would bring down the cost of business in the country, as the trade and industry were already facing problems due to high cost of energy and its crisis.
 
Yassar Sakhi Butt said that due to high discount rate in the region, Pakistani products had become uncompetitive but the current decision of cutting the policy rate would bring back life to the local economy by enhancing country’s exports.
 
He said that the present decision would also reduce the non-performing loans as the business community would able to pay back their outstanding dues on time. However, Reduction in government’s borrowing from banks is a must for expediting investment process in the industrial sector, he added.
 
ICCI President said cut in markup rates would not only strengthen economic activities but would also go a long way in controlling stagflation that was giving birth to many economic problems besides jacking up the graph of unemployment.