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APTMA slams SBP for sacrificing industrial growth

18
Apr '12
State Bank of Pakistan's (SBP) move of retaining interest rates at high levels in its Monetary Policy statement for last quarter of 2011-12 has been condemned by All Pakistan Textile Mills Association (APTMA), which has alleged that SBP is sacrificing growth of textile industry in the country by keeping interest rates at higher levels.

APTMA Group Leader Gohar Ejaz said high interest rates are further hampering the growth of the public sector in Pakistan, and there is an urgent need to reduce the policy rate down to 900 basis points.

As stated by Mr. Ejaz, the Government is enduring a loss of Pk Rs. 360 billion in circular debt, which can be easily met by increasing revenue generation by lowering interest rate.

He said that Non-Performing Loans (NPLs) have already gone up to 31 percent, and owing to severe energy crisis NPLs are likely to touch 40 percent by the end of the current quarter.

He added that SBP has accepted that majority of the bank loans have been obtained by the Government. This implies that the private sector does not get a major part in distribution of loans, and hence the Consumer Price Index (CPI) weight becomes irrelevant.

Mr. Ejaz said the energy crisis is weakening the already ailing Pakistan's textile industry and this would not only have an adverse impact on exports but also on the industry's employment generation capacity.

Fibre2fashion News Desk - India


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