ISLAMABAD:Experts on Wednesday suggested an evidence-based monetary policy to cope with the prevailing grave situation of inflation and ensure the provision of social justice in the country.
They made the remarks while discussing the economic situation of Pakistan during a consultative meeting titled “Evidence-based Advocacy on Policies for Economic Justice and Development” organized by Sustainable Development Policy Institute (SDPI) and Friedrich Ebert Stiftung (FES).
Speaking on the occasion, the head of Friedrich Ebert Stiftung (Asia & Pacific) Mirco Günther said think tanks could play a vital role in the formulation of an evidence-based monetary policy that may support governments in the provision of social and economic justice.
He warned that Pakistan had been confronted with inflation for a long time, which may led to higher inequalities. Therefore, aligning price stability was imperative to thrive socio-economic justice in the society.
Executive Director, SDPI Dr Abid Q. Suleri called upon the government to come up with evidence-based policy solutions to provide economic relief to public while at the same time satisfy the International Monetary Fund (IMF).
Joint Executive Director, SDPI Dr Vaqar Ahmad, said unpacking various forms of inequalities was a common global challenge, which would be worsen amidst global stagflation, energy crisis and conflicts.
He stressed the need for increasing public knowledge of monetary policy to enable them to demand better from political parties and influence inclusion of economic justice in party manifestos.
Chief of SDGs Support Unit, Ministry of Planning Development & Special Initiatives Ali Kemal said interest rate was “the income of capitalists” and social inequalities exacerbated by interest rate hikes as it contributed to inflation and emphasized on increasing financial services for Small and Medium Enterprises (SMEs) through commercial banks and tapping the potential of digital currency which was neglected in Pakistan.
Deputy Executive Director, SDPI Dr Sajid Amin presenting the findings of the report, “Monetary Policy for All”, suggested that SBP should set 5% inflation target for next few years as lowering inflation targets without proportional wage increase shrinks purchasing power of common person and hinder economic justice.
He recommended improving regulatory framework of commercial banks for increasing financial inclusion as 92% of their operations are centered around bigger investors, which led to higher informal borrowing.