PM welcomes interest rate cut, promises further economic growth

Shehbaz expresses optimism that interest rate cut will boost investor confidence and increase investments in Pakistan

Prime Minister Shehbaz Sharif has welcomed the State Bank of Pakistan's decision to reduce the policy rate by 2%, calling it a positive step for the country’s economy. He expressed optimism that the interest rate cut will boost investor confidence and increase investments in Pakistan.

"The reduction in the policy rate is a welcome move for our economy. It will increase investor confidence and lead to greater investment," Sharif said, adding that the recent drop in inflation has allowed for this adjustment, and he hopes inflation will continue to decline in the coming months. The policy rate now stands at 17.5%.

Speaking during a cabinet meeting on Thursday, the prime minister praised the efforts of Finance Minister Muhammad Aurangzeb and other key institutions, saying, "The efforts to revive the economy are commendable, and the reduction in interest rates will benefit all sectors."

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Sharif also spoke on the ongoing discussions with the International Monetary Fund (IMF), noting that "we have made every effort, and talks for the next programme are progressing well. Once the programme is settled, we will take steps to enhance growth."

He further highlighted the need for significant reforms in the energy sector and the Federal Board of Revenue (FBR), stating that Ahsan Langrial has been tasked with overseeing FBR reforms.

On foreign relations, the prime minister acknowledged the support of Pakistan’s allies during IMF negotiations. "Our friendly nations have once again stood by us like brothers, repeating their historical support for Pakistan."

Sharif also stressed the importance of reducing reliance on foreign loans. "We are a nuclear power, and constantly asking for loans undermines our significance. The government is working hard on this issue."

Turning to international affairs, the prime minister condemned Israeli aggression in Gaza, describing it as "one of the darkest chapters in human history." He criticised the global community for its inaction, saying, "The UN, Security Council, and international courts have been ignored by Israel, yet the world powers remain silent."

He also noted the recent killing of six UN volunteers in Gaza and said, "If this had happened elsewhere, there would have been an uproar. Today, 17 more Muslims were martyred in Gaza. We condemn Israeli brutality, but this issue has gone far beyond condemnation – the global conscience must act."