Aun Ali Syed, Vice President of the Federation of Pakistan Chambers of Commerce & Industry, has expressed deep concern over the recent increase in the policy rate announced by the State Bank of Pakistan, stating that the decision could have far-reaching negative implications for Pakistan’s already strained business environment.
He noted that while the objective of controlling inflation is understandable, the continuation of aggressive monetary tightening at this stage poses a serious threat to economic activity. The business community, particularly the trade and industrial sectors, is already grappling with rising costs, reduced demand, and limited access to affordable financing.
Aun Ali Syed emphasized that higher interest rates substantially increase the cost of doing business, making it increasingly difficult for traders, exporters, and manufacturers to secure working capital and sustain their operations. He warned that such measures may discourage new investments and could compel small and medium enterprises (SMEs) to scale down or cease operations altogether, leading to job losses and further economic slowdown.
Highlighting sector specific concerns, he pointed out that the textile and cloth markets considered a backbone of Pakistan’s commercial landscape are especially vulnerable. With declining consumer purchasing power coupled with elevated financing costs, these markets are likely to face reduced activity, ultimately impacting overall economic momentum.
He urged policymakers to adopt a more balanced and consultative approach, ensuring that the challenges faced by the business community are duly considered in monetary policy decisions. Sustainable economic growth, he stressed, requires a policy framework that simultaneously supports industry, promotes investment, and safeguards livelihoods while addressing inflationary pressures.
Aun Ali Syed reaffirmed that the business community remains committed to constructive engagement with the government and the State Bank of Pakistan to identify pragmatic solutions that ensure both price stability and long-term economic progress.
Leave a Reply