KARACHI, Nov 19: Karachi Chamber of Commerce & Industry president Shaukat Iqbal on Tuesday said the slashing of discount rate from 9 per cent to 7.5 per cent by the SBP was long awaited, which would spur the economic activities and contribute to the speedy economic revival.

The KCCI president while welcoming cut in the discount rate, however, stressed the need for reducing the lending rate correspondingly, so that the cost of borrowing for the promotion of trade and industry is also brought down, says a KCCI statement.

Mr Shaukat pointed out that earlier the discount rate was reduced by the State Bank to 9 per cent, but the commercial banks did not curtail the lending rate significantly, which continued to remain within the vicinity of 13 to 14 per cent.

He argued that the exporters were particularly finding it very difficult to compete in the world market with an export financing rate of 8 per cent, in the face of growing cost of input and especially of electricity.

He urged the Ministry of Finance and the State Bank to immediately announce a suitable reduction in the export refinancing rate as well.

Shaukat Iqbal impressed upon the banks to curtail the lending rate in proportion to the reduced discount rate, particularly when they are experiencing excessive liquidity.—APP