Staff Report
ISLAMABAD: The Federation of Pakistan Chamber of Commerce and Industry’s United Business Group (UBG) Friday urged the government to lower the interest rate, check dollar flight and cut in petroleum prices to beef up the fragile economy in the wake of swirling global inflation.
Presiding over a high level meeting of the group its chairman Shahzad Ali Malik Sitar-I-Imtiaz said an urgent plan is needed on war footing to increase the industrial production in the coming years to give a boost to export. He said once export level increases, IMF and other monetary bodies will become flexible for rupees valuation besides curtailing the widening trade deficit which in turn will make it easier to utilise the remittances for repayment of loans.
He said an increase in the interest rate also raises the cost of capital resulting in the reduction of investment within the economy as well as slow down the growth rate of the economy overall which also curbing inflation. He said interest rate is estimated an important factor affecting the saving and investment.
Shahzad Ali Malik said persistently higher rate will ultimately affect how markets are priced, could slow markets and lead to higher level of unemployment that the economy has grown used to be.
Regarding increasing prices of petroleum products he said it leads to higher inflation, increase budget deficit and puts downward pressure on exchange rate which makes impact more expensive to rising oil prices are the major concern for all developing countries and Pakistan is suffering from it too.
He said all these factors will increase cost of production and would not be able to compete global markets especially with neighbors.
Shahzad Ali Malik in view of prevailing scenario, urged the government to address these issues on top priority to fully ensure ease of doing business taking all stakeholders into confidence.
He said UBG understands the impact of global inflation grappling the world and Pakistan is also confronted with multiple challenges but government on the other hand must come forward immediately without loss of time with a clear road map to put the bleak economy on track and provide solace to hard hit traders and businesses community, he concluded.
