State Bank of Pakistan’s decision hailed by Pakistan Tanners Association: Cut in interest Rate will Stop Flight of capital

Islamabad, October 06, 2012 (PPI-OT): The decision to cut interest rate to bring it to the level of 10% was hailed by the Chairman, Pakistan Tanners Association Mr. Agha Saiddain. He said due to the high cost of doing business in Pakistan and Law and Order situation in Karachi some of our Industrial Units have set up their parallel Units in Bangladesh, Sri Lanka and other countries.

He said SPB has taken a wise step but interest rate must be further reduced to revive our Industry. He said chronic energy crises, lack of export friendly policies, low literacy rate, law and order situation, country’s image is hampering our industrial growth.

He further added that the government is the major borrower from commercial banks and nothing is left for Private Sector. Banks prefer to lend money to the government where it is safe. But without industrial growth in Pakistan whole edifice will collapse. He said most of the DFIs like PICIC, IDBP, NDFC, Bankers Equity, Pak Lybia, Pak Kuwait were either closed or merged in commercial banks.

He said the present industrial base of Pakistan was created by the DFIs who provided Equity support and financing to the industry. Most of the DFIs were running in profit and industry was growing but due to the extremely narrow thinking these were closed. He said government must introduce again DFIs in the country for long term financing to the industry.

He appreciated the decision of SBP and suggests to Reduce Interest on Export Refinance to 7.5% to boost exports.

For more information, contact:
Moinuddin Quraishi
Secretary
Pakistan Tanners Association
46-C, 21st Commercial Street,
Phase II, Extn., Defence Housing Suthority,
Karachi-75500 –
Pakistan.
Tel: +92-21-35880180, 35880184, 35899819,
Fax: 92-21-35880093
Email: info@pakistantanners.org