Bureau Report
Karachi : Mian Zahid Hussain, president of the Pakistan Businessmen and Intellectuals Forum and chairman of the FPCCI Policy Advisory Board, said the State Bank’s 50-basis-point increase in the policy rate, from 11.5 to 12 percent, is a concern for productive sectors. He acknowledged the importance of price stability but cautioned that relying on interest rates alone to curb inflation could undermine recovery, especially as businesses already face rising electricity, raw-material and transport costs.
He noted September inflation of 10.3 percent and core inflation of about 8.4 percent, against the SBP’s medium-term target of 5-7 percent. He attributed current inflation largely to higher energy prices from the US-Iran war and wheat supply disruptions, which expensive credit cannot fix.
Exports rose 11.13 percent to $8.445 billion in July-September 2026, while imports grew 13.20 percent to $19.213 billion, leaving a quarterly trade deficit of $10.768 billion. He said higher borrowing costs would erode exporters’ competitiveness. Exporters with fixed-rate Export Refinance Scheme loans are shielded, but those relying on commercial financing face added burdens, and small businesses may delay investment and hiring.
He urged the government to expand concessional financing for small and new exporters, release verified sales tax and income tax refunds promptly, ensure policy continuity on industrial power and gas tariffs, secure wheat supply, cut electricity losses and control unnecessary spending.
