FPCCI Unhappy With SBP After Monetary Policy Announcement

Notably, the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has criticized the State Bank of Pakistan's (SBP) decision to maintain the key policy rate at 11.5 percent, saying businesses and industries need relief from high borrowing costs against the backdrop.

Key points

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• He pressed the State Bank of Pakistan to reconsider its position and introduce immediate measures to backing business continuity and industrial recovery.
• Sheikh remarked the high cost of export refinancing was making Pakistani products less competitive, resulting in the loss of export orders and lower foreign exchange earnings.
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Atif Ikram Sheikh, president of the FPCCI, described the decision as contractionary and counterproductive, warning that keeping the benchmark interest rate at a high level would continue to restrict economic activity and undermine efforts to revive industry.

He remarked monetary policy was one of the few effective tools available to provide immediate backing to businesses, but the opportunity had not been utilized. The business community had demanded that the policy rate be reduced to single digits to lower the cost of doing business, he continued. Ghani Chemical Wants to Raise Rs. 1.16 Billion From Shareholders.

Sheikh remarked the central bank's cautious approach did not reflect current economic conditions, noting that the trade deficit had climbed by 18.1 percent in July and August 2026 compared with the same period a year earlier.

He remarked the industrial sector was facing an existential crisis due to high energy tariffs, rising petroleum costs, geoeconomic uncertainty and elevated financing costs. These pressures were contributing to stagnation in industrial activity nationwide.

In practice, the FPCCI president remarked manufacturing sectors were experiencing severely limited expansion since businesses were unable to secure the working capital needed to maintain operations. Tough access to financing had further intensified the challenge, he continued.

Sheikh cautioned that high borrowing costs would continue to reduce private sector credit uptake, leaving small and medium sized enterprises as well as substantial scale manufacturers with limited access to formal financing and insufficient operational liquidity.

He remarked the high cost of capital was additionally contributing to declining exports since manufacturers were unable to keep production costs competitive in international markets. Pakistani exporters were losing market share to regional competitors that benefited from more accessible financing and single digit interest rates, he continued. PC Hotel Owners Confirm Restructuring Discussions.

Sheikh remarked the high cost of export refinancing was making Pakistani products less competitive, resulting in the loss of export orders and lower foreign exchange earnings. He cautioned that national export expansion and economic recovery targets would remain tough to achieve under the prevailing monetary and fiscal policies.

He pressed the State Bank of Pakistan to reconsider its position and introduce immediate measures to backing business continuity and industrial recovery. Stay Connected with ProPakistani.

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For now, FPCCI Unhappy With SBP After Monetary Policy Announcement remains the part of the story worth watching, and further updates are likely as more details are confirmed.