Seth Muhammad Akber, Acting Chairman All Pakistan Textile Mills Association (APTMA), has criticized the Monetary Policy stating that the textile industry of the country, which is incurring huge losses due to unprecedented power crisis, was looking forward to a reduction in interest rates to single digit.
He added that maintaining a mark up at 12 percent would lead to increase in Non-Performing Loans (NPLs) and shoot up the redundancy ratio in the private sector.
The APTMA official also condemned the State Bank of Pakistan's (SBP) move of trying to hold back inflation by raising the mark up rate, and said it was the Government which was the leading borrower of the banks and not the private sector.
The Government was borrowing at a higher pace to the detriment of development of the private sector, which was losing its competitiveness owing to high cost of raising finances, he said.
Mr. Akber said lack of extra liquidity in the market was the main factor which was responsible for sluggish move of investment in the textile industry.
On the other hand, the APTMA acting Chairman said the population of the country is rising at a faster pace, which signifies high redundancy risk in the absence of appropriate plans for expansion of the industry owing to high rates of interest.
Fibre2fashion News Desk - India
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