Smuggled goods, high energy costs cripple economy

The recent reduction in the State Bank of Pakistan’s policy rate to 11 per cent, nearly half of what it was in July 2024, has failed to generate enthusiasm among the country’s traders and industrialists. While the rate cut is seen as a step towards easing the cost of doing business, many in the sector argue that it remains uncompetitive compared to regional rates and does little to address the core challenges hindering economic growth. Industry leaders point to the high cost of production and the rising influx of smuggled goods from countries such as Iran, China, and Bangladesh, which continue to undermine the competitiveness of Pakistani products in both domestic and international markets.