KARACHI, April 1: President of the Federation of Pakistan Chambers of Commerce and Industry Tanvir A Sheikh has said the projection of inflation at 8 per cent instead of 6 per cent in the current financial year amply reflects the failure of a tight monetary policy that has stifled economic growth but failed to contain inflation.

The FPCCI chief in a statement on Tuesday offered his comments on the second quarterly report of the State Bank of Pakistan released on Monday which presents a dismal economic picture of the country and predicts a slowdown of economy would bring down growth rate to 6 per cent in 2007-08 instead of originally anticipated 7.5 per cent.

Inflation, he said, had emerged a critical burning issue for the country that had social and political consequences and it leads to enhancement of poverty. He recalled that the FPCCI focussed on addressing the inflation in its pre-budget proposals.