Karachi: The President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Atif Ikram Sheikh, has voiced strong opposition to the State Bank of Pakistan's decision to maintain its policy interest rate at 11%. He labeled the move as "anti-growth," citing concerns about its detrimental effect on business sentiment and the economy.

Sheikh argued that with current inflation rates, the policy interest rate should be reduced to 7% to better align with economic conditions and stimulate growth. He stated that lowering the interest rate could decrease the government's debt burden by approximately PKR 3,500 billion, offering significant fiscal relief.

Sheikh pointed out that inflation fell to 5.6% in September 2025, according to government data. He noted that Pakistan's high interest rate is out of step with other countries in the region, which stifles economic activity and deters investment. Sheikh stressed the importance of bringing the rate down to a single-digit figure to help businesses remain competitive.

Saquib Fayyaz Magoon, Senior Vice President of FPCCI, highlighted that high interest rates increase production costs, which in turn drive inflation. He explained that a single-digit rate would lower production costs, make goods and services more affordable, and reduce inflation. Magoon also emphasized that high rates restrict access to finance, hindering economic growth.

Magoon mentioned previous assurances from Federal Finance Minister Muhammad Aurangzeb about a forthcoming reduction in policy rates, making the decision to maintain the rate a disappointment for the business community.

Abdul Mohamin Khan, Vice President and Regional Chairman Sindh of FPCCI, warned that the unchanged rate could undermine the business environment, discourage investment, and impede economic recovery. He urged the State Bank to reconsider and implement measures that support businesses and stimulate growth.

Khan reiterated that the business community is crucial to Pakistan's economy. He called for a monetary policy that includes a single-digit interest rate to boost industrial output, create jobs, and stabilize prices. Khan urged the State Bank to align its policies with the needs of the economy.