LAHORE: The Lahore Chamber of Commerce & Industry has urged the State Bank of Pakistan (SBP) to bring down the markup rate to single digit in the larger interest of trade, industry and economy. In a statement, LCCI President Irfan Iqbal Sheikh said that reduction in markup rate from existing 13.25% to single digit would be a great favor to the industrial sector.
It would help the government to attain the target of industrial growth, would reduce the cost of product and would also bring capital of the banks into circulation. “Markup rate influences the cost of product. Pakistani products cannot compete in the international market to those countries which are offering capital to their industries on zero or less than one percent markup rates”, the LCCI President added.
He said that policy rate increased to 13.25 in July 2019 as compared to 6.5% in May 2018. Sharp increase in interest rate pushed up borrowing cost that retarded investment, capacity generation and hence exports. Irfan Iqbal Sheikh said that tight monetary policy stance had always proved a big blow to the industrial sector. “We have to move forward quickly, as like as other countries of the region, to make the country a hub of manufacturing activities and a heaven for investors”, he added.
LCCI Senior Vice President Ali Hussam Asghar and Vice President Mian Zahid Jawaid Ahmad urged the State Bank of Pakistan to announce at least 400 basic points cut in markup rates in the upcoming monetary policy.