February 02, 2008	Saturday	Muharram 23, 1429

LAHORE, Feb 1: The Lahore Chamber of Commerce and Industry (LCCI) and the Pakistan Industrial Associations Front (PIAF) have slated the State Bank of Pakistan’s decision to raise the interest rate on the pretext of controlling fast increasing inflation.

LCCI President Mohammad Ali Mian was of the view that the decision would not only increase the cost of doing business but would also destroy the local industry facing a crisis due to shortage of gas and electricity. Instead of strengthening the supply chain to control inflation, the State Bank had increased the interest rate, which would ultimately affect the whole production process.

He said that the tightening of monetary policy would not do any good to the economy complaining about being uncompetitive in the global economy due to high cost of doing business. Imbalances in the economy such as increasing trade deficit, current account deficit, high saving and investment gap, huge government borrowing and persistent high inflation including food inflation would leave a very negative impact on it. If the government was serious to promote local businesses, it would have to look at the monetary policy afresh keeping in view the ground realities.

PIAF Chairman Mian Abuzar Shad said that that State Bank had landed the economy in crisis by releasing more loans during the first half of 2007 than the target of the whole financial year. Raise in interest rates on the pretext of tightening of monetary policy would play havoc to the economy already under pressure due to gas and electricity shortage.

He said that the economy was under serious threat due to increasing trade deficit and the State Bank was increasing its troubles by pushing the cost of doing business upwards. Exports were likely to fall as a result of increase in costs of products, he added.

Business women: Women entrepreneurs have demanded that the State Bank of Pakistan should recognise women entrepreneurship as a separate sector for advancing loans up to Rs100,000 to women without collateral.

The demand was aired at a meeting of women entrepreneurs of Punjab with the SBP officials held at the Trade Development Authority of Pakistan here on Friday.

They also asked the SBP to consider starting group loaning facility for women on the pattern of India, besides, launching innovative credit schemes for them.

The entrepreneurs included Women Chamber of Commerce and Industry President Shehla Akram, Lahore Chamber of Commerce and Industry Women Entrepreneurs Committee chairperson Shamim Akhtar and Multan Chamber of Commerce and Industry Women Entrepreneurs Committee chairperson Kausar Ishaq.