Pakistan's monetary policy and its formulation process is going though several changes with budding economic dynamics within the country.
Last week Shamshad Akhter, Governor State Bank of Pakistan had announced a new monetary policy with dual objective of promoting economic growth and price stability.
When Fibre2fashion contacted Shabir Ahmed, Chairman, Pakistan Bedwear Exporter's Association, he explained, “The major change in the policy is that the markup rate has been increased by 0.50 percent basis points and the export refinance policy have been changed as previously the State Bank use to finance the exporters 100 percent at 7.5 percent and now the State Bank will give 70 percent and the Commercial Banks will have to finance the balance 30 percent from their own resources.”
Talking about the impact of new monitory policy on textile exporters, Shabir divulged, “In our opinion this policy may not be good as exporters think that the markup rate will increase by about 1 or 2 percent and the commercial bank after some time will also raise their rates on the balance 30 percent.”
Regarding the reaction of Commercial Banks the Chairman believes, “The commercial Banks are also not happy as the policy has fixed the credit ceiling of the bank. Due to this banks will have problem to accommodate the new clients if the existing ones demand an increase in finance. However, the State Bank Governor has assured that if any problem arises the State Bank will accommodate them by increase the limits.
Shabir Ahmed also informed that small and medium size enterprises will be adversely affected due to this policy.
During a meeting the exporters proposed the Governor that the new scheme will be tried out for three months and steps will be taken accordingly in the future.
Fibre2fashion News Desk - India
marketing@alchempro.com
