PM Shehbaz Says Reduction in Policy Rate Expected to Stimulate Business

Prime Minister Shehbaz Sharif recently announced a reduction in Pakistan’s policy interest rate, an economic measure aimed at boosting business activities and economic growth amid challenging times. Lowering the policy rate is expected to increase access to financing for businesses, enabling them to invest more freely and potentially hire more workers, thus contributing to a more vibrant economy. This decision aligns with the government’s broader economic strategy to revitalize industry and reduce inflationary pressures affecting consumers.

The reduction comes as Pakistan’s economic challenges, including inflation and limited foreign exchange reserves, continue to impact growth. With this policy adjustment, small and medium enterprises (SMEs) are likely to benefit significantly, as they often struggle with higher borrowing costs. The move also signals to investors that the government is committed to fostering a business-friendly environment, even as it tackles structural economic issues.

Economists believe this reduction could have positive ripple effects on key sectors, such as manufacturing, retail, and services, as improved liquidity helps drive demand. By incentivizing business expansion, the policy rate cut is intended to generate employment opportunities and enhance overall economic stability in Pakistan.