HSATI Chairman Urges Reduction in Interest Rate to Revitalize Economy

HYDERABAD: Zubair Ghangra, Chairman of the Hyderabad SITE Association of Trade & Industry (HSATI), has voiced strong disapproval of the existing 11% interest rate, deeming it unacceptable given the current economic vulnerabilities.

He asserted that the elevated rate presents a major impediment to Pakistan’s economic progress, particularly considering widespread inflation, an industrial slump, and a sluggish business climate. He commented, “This policy rate is hindering national development.”

Ghangra highlighted that the Pakistani government is extensively borrowing from commercial banks, incurring annual interest payments amounting to trillions of rupees. He emphasized that this substantial financial strain on the national treasury could be redirected toward industrial advancement, economic overhauls, and financial assistance for traders and small enterprises.

He further stated that a reduction in the interest rate to single digits could result in trillions of rupees in annual savings, which could then be invested in essential economic projects.

He also stressed that restoring business confidence hinges on lowering the interest rate to a more reasonable level. He cautioned that “Entrepreneurs, industrialists, and investors are hesitant to secure loans due to the prohibitively high cost of borrowing,” and warned that this leads to economic stagnation and reduced job opportunities.

Chairman Zubair Ghangra drew comparisons between Pakistan’s monetary policy and those of neighboring countries, noting that nations such as Bangladesh, India, and Vietnam have successfully maintained single-digit interest rates to stimulate their economies. He urged, “We must implement a similar strategy to sustain competitiveness and safeguard industrial survival.”

In closing, Zubair Ghangra earnestly appealed to the State Bank of Pakistan and the Federal Government to promptly decrease the policy rate to a single-digit level, aligning it with the prevailing economic realities. He emphasized, “This is not merely a matter of relief for the business sector, but also an urgent necessity for the government, as elevated interest payments are exacerbating the debt cycle and diminishing development expenditures.”

“The time has come to adopt practical measures to stabilize the economy by lowering interest rates to a sensible level. This will pave the way for increased investment, improved exports, job creation, and relief for the public,” he concluded.