KARACHI - The businessmen of the country have maintained that one percent cut in the discount rate will not lead to the revival of industry. They, however, said that cut in the interest rate was a positive sign and it indicates that the SBP would further reduce the discount rate in July this year. Anjum Nisar, President Karachi Chamber of Commerce and Industries while talking to The Nation said the businessmen were demanding for at least 2 to 3 per cent cut in interest rate while the State Bank of Pakistan had announced only one percent cut in the discount rate which will not be a source of revival of shaken economy and industry. KCCI president said that Pakistan was already lagging behind India and Bangladesh in economic growth and exports due to high interest rate and energy crisis. Pakistan was the only country that was managing a very high discount rate in the region as most of the countries have already reduced the interest rate to the lowest level. The one per cent cut in interest rate was not matching with the demand of the industry but anyway it was positive sign for the economy and industry, he opined. It may be noted here that the inflation and KIBOR have declined by more than 300 basis points in last few months and the central bank should have incorporated a matching cut in the discount policy rate. In January the inflation was above 25 per cent and now it was around 22 per cent. Similarly, KIBOR has squeezed from 16 per cent to 12.44 per cent, but 100 basis points cut in the discount rate was negligible. Zubair Tufail, member Managing Committee of FPCCI termed this cut in interest rate insufficient and said it was disappointing for the industry and much below the expectation of the business community. He said that businessmen were demanding at least 3 per cent cut in the interest but the announcement of SBP Governor was only a symbolic which will not leave positive effect on the business. Zubair reminded that once SBP Governor had assured them for 2 per cent cut interest rate while business community was confident and hoping that head of SBP will meet its commitment but it gave nothing than disappointment. FPCCI senior member opined that trade and industry was facing difficulties in meeting its investment and financing needs due to a very high cost of borrowings from the banks that was triggered by high interest rates while this phenomenon was causing further slow down to the economic activities in the country. Majyed Aziz former president of KCCI said that one per cent cut in interest rate was something better than nothing. He said the business sector was facing difficulties in getting credit due to higher mark-up rate resulting in slowdown. It is worth noting that neither the industry nor the common people would take any incentive of one per cent decline in the interest rate.