Islamabad Chamber of Commerce and Industry (ICCI) President Ahsan Zafar Bakhtawari has called on the government and State Bank of Pakistan (SBP) to reduce the interest rate to single digit in the upcoming review. He emphasized that high interest rate has increased the cost of doing business, reduced investment and discouraged entrepreneurship thus, making it essential to lower the rate to stimulate economic activity, ultimately leading to job creation and economic growth.

Talking to media persons, Bakhtawari expressed disappointment with the recent policy rate cuts, calling them “too little, too late.” He noted that the business community had expected more substantial cuts, rather than the modest in June and July. He stressed that reduction is crucial to provide relief to businesses facing economic challenges due to high power and gas charges, which have led to diminished economic activity, reduced exports, lower foreign direct investment and increased unemployment.

The ICCI President highlighted the urgent need for relief, particularly for Small and Medium Enterprises (SMEs) and cottage industries that are struggling to survive. He argued that a reduction in interest rates would increase demand and supply, driving economic recovery and growth.

He emphasized that SMEs represent the backbone of the economy and need favorable financial conditions to thrive. Reducing interest rates could enable these businesses to grow and contribute significantly to the national economy. Furthermore, a reduction in interest rates would also lower inflation, providing relief to the country’s impoverished population.

He went on to say that at the moment neither the local nor the foreign investors can think of making investment which is ultimately inflicting severe economic hard to the country and to come out of the situation the initiative would be a step in the right direction.