Chairman of National Business Group Pakistan, President Pakistan Businessmen and Intellectuals Forum, All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain said on Wednesday that reports of a further increase in interest rates by State Bank are worrying. He said that interest rates are already so high that further expansion would be disastrous for the economy.

Mian Zahid Hussain said that before making a decision, its implications should be considered by policymakers.

Talking to the business community, the veteran business leader said that the central bank is considering increasing the interest rate from one hundred to one hundred and fifty basis points as it thinks it will help reduce inflation while stabilising foreign exchange reserves. However, the central bankers should also consider that the interest rate was raised to 22 per cent in April and was not cut last month, which disappointed the business community, he said.

The business leader said that a further increase of one or one and a half per cent would make it impossible to do business for many, closing many companies and increasing unemployment. The move will also increase the burden of interest on the government, which is already 7200 billion rupees annually.

In the country’s current situation, it would be more beneficial to reduce interest rates than to raise them, as businesses are in a bad state, unemployment is high, and bank defaults are also increasing rapidly, he noted.

Mian Zahid Hussain said that new trade agreements are being made between international powers in our neighbourhood. Western and Arab countries are increasing trade by ignoring India’s open human rights violations. Pakistan is a silent spectator instead of being a part of this whole issue, which is a sign of poor management.

The G20 meeting in India has proved that the world is more interested in trade than ethics, and if we want to be valued and heard, sloganeering will no longer work, but business will. He said that concrete measures must be taken to increase the country’s exports, without which the economy cannot become stable.

No one in the world cares about a bankrupt country, no matter how big the consumer market is or whether it is armed with nuclear weapons.

Mian Zahid Hussain further said that in these circumstances, establishing SIFC is a ray of hope, and it is necessary to enhance the role of the private sector to achieve its goals.