Tanveer urges SBP to cut rate to 6%
SM Tanveer, Patron-in-Chief of the United Business Group (UBG), has called on the State Bank of Pakistan (SBP) to cut the policy rate to 6%, citing a sharp drop in inflation. He noted that the Consumer Price Index (CPI) stands at 0.3%, while average inflation is around 4%, making the current 11% interest rate excessively high.
"The International Monetary Fund (IMF) also recommends keeping interest rates positive relative to inflation," said Tanveer.
With the monetary policy announcement due on July 30, Tanveer argued that a rate cut would stimulate economic activity, reduce the government's Rs8.5 trillion interest burden, and potentially save Rs3.5 trillion.
He added that lower rates would help industries struggling with borrowing costs and make Pakistani exports more competitive globally. Tanveer criticised recent budget measures, especially Sections 37A and 37B, for allowing arrests and detentions, saying such policies discourage investment and stifle growth. He urged the government to create a more business-friendly environment.
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