Mian Zahid Hussain has said the State Bank of Pakistan’s 50-basis-point hike to 12 percent is a concern for industry, exporters and small businesses, warning that higher borrowing costs could slow investment, production and employment growth.

He said controlling inflation was important, but relying mainly on interest-rate increases could undermine economic recovery, especially when energy prices and supply-side challenges were driving inflation.

Referring to trade figures, he noted that exports rose 11.13 percent to $8.445 billion during July-September 2026, but imports grew faster, widening the trade deficit. Higher financing costs, he said, could weaken exporters’ competitiveness and profitability.

Mian Zahid observed that SMEs were particularly vulnerable to expensive credit, as rising borrowing costs could delay expansion, machinery purchases and hiring. He urged the government to improve access to concessional financing, accelerate the release of verified tax refunds and ensure stable energy tariffs for industry.

He stressed that sustainable economic stability required a balanced approach that controls inflation while supporting industrial growth, exports and job creation.