Business leaders criticise hike in interest rate

Business Recorder reported that business leaders have criticised the State Bank of Pakistan’s 50-basis-point policy rate increase, which took the rate from 11.5 percent to 12 percent. Representatives of the Karachi, North Karachi and Korangi business associations said higher borrowing costs would burden firms and discourage investment, production and industrial expansion.

The leaders argued that inflation reflected pressures including energy and fuel prices, supply disruptions and higher costs for essential goods, rather than excessive domestic demand. They warned that more expensive financing could raise manufacturing costs, weaken export competitiveness and constrain employment, and called for affordable credit and measures addressing energy costs and taxation. These views are the business representatives’ criticism of the decision, not a separate SBP assessment.