High Interest Rate Hurting Economy, Says Former FPCCI VP Zahid Iqbal

Islamabad: Zahid Iqbal Chaudhry, former Vice President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), has voiced strong concern over the persistently high interest rate in the country, calling it one of the biggest impediments to Pakistan’s economic revival and industrial progress.

While speaking to the media in Vehari on Sunday, Zahid Iqbal said that the business community, under the leadership of SM Tanveer, is urging the State Bank of Pakistan’s Monetary Policy Committee to bring the policy rate down to a single-digit figure—ideally between 5% and 6%—in its upcoming meeting scheduled for July 30.

He pointed out that Pakistan’s inflation rate has recently dropped to approximately 4.5%, the lowest in several years, according to official statistics. In such an environment, he argued, maintaining a high interest rate is unjustified and harmful to the economy. “It increases the cost of production, damages export competitiveness, and discourages domestic and foreign investment,” he said.

“The current high interest rate has become a serious challenge for the business sector,” Zahid Iqbal emphasized. “Reducing it is a unified demand of the business community, strongly advocated by SM Tanveer, Patron-in-Chief of the United Business Group, and Atif Ikram, President of FPCCI.”

He further highlighted other major issues faced by the business community, including rising production costs, inconsistent policies, excessive taxation, overreach by the Federal Board of Revenue (FBR), and ongoing political uncertainty. These factors, he said, are damaging investor confidence and slowing economic activity.

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Zahid Iqbal praised the recent high-level engagements between top business leaders—SM Tanveer, Gohar Ejaz, and Atif Ikram—and key decision-makers in the government, expressing optimism that these interactions will result in policy reforms and economic relief for Pakistan’s business and industrial sectors.