LCCI for single digit markup rate

LAHORE: The Lahore Chamber of Commerce and Industry (LCCI) urged the State Bank of Pakistan (SBP) to bring down the markup rate to single digit in the larger interest of trade, industry and economy.

LCCI President Irfan Iqbal Sheikh told the news men here that reduction in markup rate from existing 13.25 percent to single digit would be a great favor to the industrial sector. It would help the government to attain the target of industrial growth as it would reduce cost of production and also bring capital of the banks into circulation, he viewed.

"Markup rate influences the cost of product. Pakistani products cannot compete in the international market with those countries which are offering capital to their industries on zero or less than one percent markup rates," he mentioned.

Irfan Iqbal said that policy rate increased to 13.25 percent in July 2019 as compared to 6.5 percent in May 2018. Sharp increase in interest rate pushed up borrowing cost that retarded investment, capacity generation and hence exports. He said that tight monetary policy stance had always proved a big blow to the industrial sector. "We have to move forward quickly like other countries of the region, to make the country a hub of manufacturing activities and a heaven for investors," he added.

LCCI Senior Vice President Ali Hussam Asghar and Vice President Mian Zahid Jawaid Ahmad urged the State Bank of Pakistan to announce at least 400 basic points cut in mark-up rates in the upcoming monetary policy.