The Pakistan Vanaspati Manufacturers Association (PVMA) has called on the State Bank of Pakistan (SBP) to reduce the policy interest rate to single digits during its upcoming Monetary Policy Committee meeting on December 16, 2024.
PVMA Chairman Sheikh Umer Rehan stressed the need for a substantial reduction, citing a drop in inflation to 4.9 percent in November 2024, the lowest in 80 months, as a key factor behind the request.
In a statement, Sheikh Umer pointed out that inflation had decreased from 7.2 percent to 4.9 percent, arguing that the current policy rate of 13-15 percent is harmful to the economy and business activities.
“The current economic conditions support a reduction of more than 5 percent in the interest rate,” he said.
He commended the efforts of the government, particularly the Prime Minister, Finance and Commerce Ministries, and the Army Chief, for helping stabilize the economy.
He also credited the Special Investment Facilitation Council (SIFC) for playing a crucial role in restoring business confidence.
Sheikh Umer stated that lowering interest rates would revive Pakistan’s struggling economy by providing affordable loans to industrialists, promoting investment, and reducing the government’s debt burden.
“Lower rates will increase trade opportunities and economic activity, putting Pakistan on track to meet its growth targets by the end of the fiscal year,” he concluded.
The business community has echoed these views, urging policymakers to focus on growth-driven measures as the country continues its economic recovery.