Korangi Association of Trade and Industry (KATI) President, Junaid Naqi, applauded the State Bank of Pakistan’s recent 2.5% interest rate reduction, describing it as a positive move but urging for further cuts to bring the rate down to single digits. Naqi stressed that the current high-interest rates have hindered economic growth, restricting industrial investment and capital flow. He believes a lower policy rate would inject much-needed momentum into the economy. While acknowledging the benefits of the rate cut, Naqi raised concerns about the potential increase in imports, which could exert pressure on both the rupee and the trade balance. He recommended that the government implement measures to control imports, safeguarding the rupee’s stability. Although the rupee has maintained its current value, Naqi noted that an undervalued currency does not necessarily benefit exporters. He advocated for a balanced currency approach, aligned with economic fundamentals, growth objectives, and foreign exchange reserves, to ensure fair competition for exporters. Naqi also called on the government to establish a long-term policy that supports both the rupee’s value and a stable interest rate environment. He argued that such policies would be advantageous for the industry, particularly in strengthening the export sector and securing sustainable economic progress.
