Interest rate hike to slowdown economy exports will be a challenge: Mian Zahid Hussain.

• Position: President Pakistan Businessmen and Intellectuals Forum, President All Karachi Industrial Alliance, Senior Vice Chairman of the Businessmen Panel of Federation of Pakistan Chambers of Commerce & Industry and former provincial minister - Conference notes

Byline: Mian Zahid Hussain

President Pakistan Businessmen and Intellectuals Forum (PBIF), President All Karachi Industrial Alliance (AKIA), Senior Vice Chairman of the Businessmen Panel of FPCCI and former provincial minister, Mian Zahid Hussain on Wednesday said recently announced monetary policy is too aggressive. An interest rate hike of 1.5 percent by the central bank is over and below the expectations of the experts and the business community but it will choke the economic growth at this critical juncture, he said.

Talking to the business community, the veteran business leader said that the monetary policy after a poorly negotiated deal with the IMF, will hit manufacturing, agriculture, exports and jobs while it will deprive the private sector of much-needed credit resulting in defaults and litigation. He said that another interest rate hike is expected which will be disastrous for the economy. He added that private banks will find it attractive to lend to the government which is risk-free while the private sector will be able to get loans at 15 to 16 percent interest which is unsustainable.

The former minister noted that that business community was already facing problems like increased cost of doing business, inflation, devaluation etc. and now...