FPCCI warns against more erosion in exchange rate

F.P. Report

ISLAMABAD: The Businessmen Panel of the FPCCI on Wednesday said further erosion in the exchange rate on the directives of IMF will amount to economic suicide. The suggestion to upward revise the interest rate by the State Bank of Pakistan is against the national interest as it will result in the closure of businesses, unemployment and defaults by the businesses, it said.

Any hike in the interest rates will result in contraction of the economy which will lay waste to all the efforts of the government to revive the economy, said Naseem-ur-Rehman, a central leader of the BMP.

Increased interest rates will push many businesses towards lack of competitiveness which will destabilise the balance sheets of the commercial banks, he added.

Naseem-ur-Rehman said that such a damaging move will not only waste efforts to stabilise the economy but also create problems for the government in the upcoming elections. He said that following IMF will also result in increased taxes and cut in developmental budgets which will have economic and political repercussions.

The business leader said that government has done a lot to put the economy back on track, improved the direction of the economy, upgraded infrastructure, ensured law and order and enhanced energy supplies which have boosted the confidence of the business community.

All these achievements should not be reversed at any cost as Pakistan remained under the IMF programme for many years but the problems could not be resolved.

He said that government should immediately start improvement in the tax system, energy supplies, and sell bleeding state-run enterprises wasting trillions of rupees per annum.

IMF should not be pleased at the cost of masses and the economy, he demanded.