Junaid Naqi, President of the Korangi Association of Trade and Industry (KATI), has called for a substantial reduction in the policy interest rate in the upcoming Monetary Policy Committee (MPC) meeting scheduled for July 30. He stated that with inflation falling to 3.2% in June and the current policy rate standing at 11%, there is no justification for maintaining such a high rate.

Naqi emphasized that Pakistan’s industrial sector is already under severe pressure. “Factories are operating at partial capacity, new investments have slowed, and business confidence is low,” he said. “It is imperative that the government and the State Bank of Pakistan provide immediate relief to revive industrial activity and boost exports.”

Highlighting the broader economic picture, Naqi pointed out that Pakistan’s GDP grew by only 2.1% in the previous fiscal year, significantly lower than other countries in the region. “With the right support and a business-friendly environment, our growth rate can improve substantially,” he said.

He criticized the continuation of outdated monetary policies that he believes are obstructing economic progress. “Across the globe, countries are reducing interest rates to stimulate business activity. Unfortunately, Pakistan is still sticking with old policies that are hurting rather than helping the economy.”

Naqi demanded that the policy rate be slashed in the upcoming MPC meeting to provide relief to the industry. “If industries are not supported now, we could see rising unemployment, declining investment, and missed revenue targets,” he warned.

He urged the central bank to take decisions based on ground realities, saying: “A stable economy can only be built on realistic and responsive policies.” Expressing hope, he added that the government and SBP would recognize the challenges faced by the industrial sector and take concrete steps to ease the burden, including a meaningful cut in interest rates to help stabilize the economy.