ISLAMABAD: National Traders Alliance on Wednesday said that the decision of an increase in State Bank of Pakistan’s key discount rate to 13.0 percent in the monetary policy would devastate stock trading and other businesses and result in increased unrest across country. Malik Sohail Hussain, Vice President, Quami Tajir Ittehad Pakistan and former Senior Vice President Islamabad Chambers of Commerce and Industry said that masses are paying for slippages of Government and this practice should end before things go out of control.
He said that whole nation is engulfed in deadlines issued by local Taliban, PML-N, lawyers, All Party’s Democratic Movement and other groups etc while economic managers are getting benefits of the situation. Business leader including Chairman Blue Area Traders Association Malik Sagheer,
Chaudhry Wasim, Abdul Hamid Abbasi, Yusuf Rajput and others said that State Bank of Pakistan seems to have no other remedy except bringing the economy and standard of living of masses down. The Governor of Central Bank Shamshad Akhtar has not consulted stakeholders as claimed in the monetary policy speech.
Malik Sohail said that the inflation could not be controlled by such measures, as it is the eighth time the State Bank has increased rates since 2005. It seems that the mistake would be repeated in near future. He said that the recent decision is likely to meet the same fate as the earlier ones but it will leave a very negative impact on the economy and banks. “We would not allow any more anti-masses steps that will make it impossible for businesspersons to breakeven,” he said.
Apart from other international factors, record hike in oil prices, failure to tame oil-marketing companies, retailers, refiners, hoarding and massive borrowings are also to be blamed for soaring inflation. Growing off-budget liabilities, enhanced expenditures, unnecessary foreign trips, loan waivers and hefty salaries poses severe challenges to monetary management.
Malik Sohail said, “The economic managers should find an acceptable solution to the accelerated inflation, flight of capital, widening current account and fiscal deficits and evaporating credibility.” The target set for the inflation in the current fiscal year is 12 per cent that will be hard to achieve, he opined. “Why masses and traders should pay for depleting reserves, damping rupee and multiple political, geo-political issues,” he asked.
The newly-elected government did not stop borrowing from the State Bank despite alleging former governments for it,” he said. Economic managers continue to play with the vulnerable sections of society and there is no end to this in sight. He said credit outlay to the industrial sector is already on the decline. The industry is under pressure and finding it hard to stay afloat and now decision to transfer more burden on this sector will add to the miseries. The small traders would be unable to continue in the current scenario.
It is the political leaders and their decision that have triggered continued foreign disinvestment and not the masses, he said adding that State Bank of Pakistan knows only one way to confront problem which has been rejected by business community.-SANA