Think Tank EPDB urges govt to slash key rates on emergency basis

The Economic Policy and Business Development (EPBD) report has said that recent floods have severely affected agriculture, industry, and the national economy, reported 24NewsHD TV Channel. 

In its report on state of economy, Economic think tank Economic Policy and Business Development demanded of the government that in the wake of floods, the interest rate should be brought down to 9 percent on an emergency basis to increase economic growth. 

The report said that the urgent measures should be taken to increase economic growth and interest rates should be immediately brought down to 9 percent to reduce business costs. 

Reducing interest rates will provide relief to flood-affected farmers and businessmen, help in the immediate restoration of infrastructure in flood-affected areas, and make it possible to restore agriculture. 

A reduction in interest rates will help industries run, the report of an economic think tank says that monetary policy is forcing the business community to work at expensive interest rates, interest rates in Pakistan are higher than those in regional countries, the 11 percent interest rate in Pakistan is making business costs expensive. 

Bringing the interest rate to 9pc could create a fiscal space of Rs 3,000 billion. The think tank says that people in flood-affected areas are in dire need of employment. By reducing the interest rate, industries can provide employment to millions of people. 

The unemployment rate in Pakistan has reached 22 percent, interest rates should be reduced in stages, bringing the interest rate to 6 percent by December 2025. Keeping the interest rate high in monetary policy is an obstacle to economic development.