Karachi: In a critical assessment of recent monetary policy, Zubair Tufail, former President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) and current President of the United Business Group (UBG), has expressed significant concern over the State Bank of Pakistan's decision to increase the interest rate by 100 basis points. Tufail argues that this decision could push the country's industry into severe difficulties and has called for an immediate reversal of the 1% increase.

According to the United Business Group, Tufail highlighted that the UBG leadership had already presented all pertinent data to the central bank, advocating for a reduction of the interest rate to single digits. He noted that despite global challenges, including tensions involving Iran and the United States, maintaining rather than increasing the rate would have been a more prudent approach.

Tufail warned that the heightened interest rate would place Pakistan at a disadvantage in global markets by escalating production and business costs. He pointed out the contradiction in efforts to expand exports and compete internationally while simultaneously imposing financial burdens that hinder such progress.

He further criticized the decision as hasty, made without a comprehensive understanding of the existing economic challenges. This has reportedly led to widespread concern within the Pakistani business community.

Tufail concluded by asserting that inflation control requires a multifaceted approach, including reductions in energy costs and improvements in the business environment, rather than relying solely on interest rate hikes.