High interest rate by State Bank of Pakistan to wreck country's economy

After the State Bank of Pakistan "surprisingly" increased the interest rate by 250 basis points, Federation of Pakistan Chambers of Commerce and Industry (FPCCI) President Irfan Iqbal Sheikh said, this will put a halt to the economic and commercial activities in Pakistan.

Business chambers are in a state of panic and shock as they are speculating on how to cope with the fallout, reported The Express Tribune.

The State Bank of Pakistan has increased the interest rate by 250 basis points to 12.25 per cent, reported the local media on Thursday.

Expressing grave concerns over the hike in the interest rates, FPCCI president Sheikh, underlined that its repercussions would be witnessed in economic activities in the absence of any governmental support.

He also said that the move is also going to hurt the exports of the country. He mentioned that the country was already facing a huge disadvantage as the interest rates in the regional countries were lower than Pakistan's.

Drawing comparisons with other economies, he said that the key policy rate in Malaysia stood at 2 pc, China at 3.7 pc and Bangladesh at 5 pc, reported the newspaper.

"If the interest and export refinancing rates are not decreased drastically in Pakistan, then we will not be able to compete with the regional countries," he emphasised.

( With inputs from ANI )

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