KARACHI: Mian Nasir Hyatt Maggo, President FPCCI, has criticized the State Bank of Pakistan (SBP) for their “miserable handling of the latest T-Bills Auction; resulting in hefty costs to the national exchequer in an unfair”.
According to a statement, the FPCCI president was referring to the latest T-Bill auction for a period of three months at 10.75 per cent and six months at 11.5 per cent; while policy rate is maintained at 8.75 per cent.
Mian Nasser Hyatt Maggo noted that even Finance Minister Shaukat Tarin admitted on national television that SBP should have checked and prevented the manipulative manner in which the commercial banks were able to sell 2% over and above of the policy rate for three months T-Bills and 2.75% for six months.
Mian Nasser maintained that if he was in SBP’s shoes he would have fined commercial banks heavily for their rent-seeking behavior in the middle of a deal with International Monetary Fund (IMF); and, grasping the sensitivity and criticality of the situation that the government cannot any longer borrow from the central bank. “This tantamount to blackmailing in the hour of need”, he added.
He further said that a correction was warranted and justifiable through cancellations of the awarded bids or else SBP should stop Open Market Operations (OMO) for the commercial banks to make them fall in line in the larger national interest,
else, commercial banks will continue to fuel inflation through speculative buying into government debt.
Nasser Hyatt added that FPCCI always keeps its doors open to the government but, they seldom consult the apex, representative and federal chamber of the country. “We could have provided the timely, workable and objective advice, had we been contacted”, he concluded.
