Islamabad: The Islamabad Women’s Chamber of Commerce and Industry (IWCCI), led by Founder President Samina Fazil, has urged business organizations to advocate for reducing Pakistan’s policy interest rate to six percent. Fazil warned that the current 11 percent rate is stifling economic recovery, even as inflation shows a marked decline.

In anticipation of the State Bank of Pakistan’s monetary policy announcement on July 30, Fazil argued that recent economic indicators justify aggressive monetary easing. Pakistan’s headline inflation decreased to 3.2 percent in June, down from 3.5 percent in May, with monthly CPI growth slowing to 0.3 percent. Despite these figures, the State Bank has maintained a tight monetary stance.

Fazil highlighted that the high real interest rates, which are over 7.8 percentage points above inflation, are undermining business confidence and deterring private investment. She stated that a reduction in the policy rate to six percent could lower borrowing costs, revitalize industrial capacity, and attract new investment in manufacturing and services.

She further noted that a significant rate cut could result in considerable fiscal savings for the federal government. By reducing the policy rate by 500 basis points, annual debt servicing costs could decrease by Rs 3.5 trillion, representing 8 to 10 percent of total federal spending. These savings could help fund public welfare programs, reduce the fiscal deficit, and provide subsidies for low-income households.

Fazil credited the United Business Group’s advocacy for economic reforms to the leadership of Patron-in-Chief SM Tanveer, whose growth-focused vision has influenced the group’s policy stance. She emphasized that regional unity has enhanced the group’s role as a platform for pragmatic policy solutions.

The last Monetary Policy Committee meeting on June 16 kept the rate at 11 percent, citing external vulnerabilities and inflation forecasts. However, Fazil noted the continued trend of disinflation and urged the State Bank to adjust its policies to reflect current economic conditions.

With the monetary policy decision approaching, Fazil called on trade bodies and chambers nationwide to unify in support of monetary easing. She expressed confidence that sustained pressure from the business community could guide the central bank toward a more balanced and growth-focused policy. Fazil also praised SM Tanveer as a respected voice in the business community, advocating for reforms based on practical economic insights and industrial revitalization.