Pakistan’s central bank keeps interest rate on hold at 22 percent

The logo of the State Bank of Pakistan (SBP) is pictured on a reception desk at the head office in Karachi, Pakistan July 16, 2019. (Photo courtesy: REUTERS/FILE)
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Updated 18 March 2024
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Pakistan’s central bank keeps interest rate on hold at 22 percent

  • Interest rate unchanged for sixth straight meeting as per expectations of majority of analysts
  • Bank said although inflation rate eased in February, it remained high and subject to risks

KARACHI: Pakistan’s central bank on Monday held its key interest rate at 22 percent for the sixth straight policy meeting as inflation risks continued to loom.
The decision was in line with the expectations of a majority of analysts, although most are also expecting rate cuts from the second quarter of this year.
The bank said that although the inflation rate had eased in February, it remained high and subject to risks.
“This warrants a cautious approach and requires continuity of the current monetary stance to bring inflation down to the target range of 5–7 percent by September 2025,” the State Bank of Pakistan’s (SBP) monetary policy committee said in a statement.
Monday’s policy decision is the last ahead of the April expiry of a $3 billion Stand by Arrangement with the International Monetary Fund.
Pakistan’s key rate was last raised in June to fight persistent inflationary pressures and to meet one of the conditions set by the IMF for securing the critical bailout. 

 

 


Pakistan accuses India of manipulating Chenab flows, seeks clarification under Indus Waters Treaty

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Pakistan accuses India of manipulating Chenab flows, seeks clarification under Indus Waters Treaty

  • Foreign office spokesperson says sudden variations in river flows threaten agriculture, food security and livelihoods downstream
  • He also condemns a hijab-removal incident in India, calling it part of a broader pattern of religious intolerance and Islamophobia

ISLAMABAD: Pakistan said on Thursday it had observed abrupt variations in the flow of the River Chenab during the ongoing month, accusing India of manipulating river flows at a critical point in the agricultural cycle and saying it had written to New Delhi seeking clarification.

Local media reported quoted Pakistani officials as saying India released about 58,000 cusecs of water at Head Marala on Dec. 7–8 before sharply reducing flows to roughly 870–1,000 cusecs through Dec. 17, far below the 10-year historical average of 4,000–10,000 cusecs for this period.

Pakistan’s Foreign Office spokesman Tahir Andrabi told a weekly media briefing in Islamabad India had failed to share prior information or operational data on the Chenab flows, a practice he said New Delhi had previously followed under the 1960 Indus Waters Treaty. New Delhi said earlier this year it had put the treaty “in abeyance” following a gun attack in Indian-administered Kashmir that it blamed on Pakistan, a charge Islamabad denied, calling instead for an impartial and transparent international investigation.

Pakistan also described India’s unilateral suspension of the treaty as a violation of international law and an “act of war.”

“Pakistan would like to reiterate that the Indus Waters Treaty is a binding international agreement, which has been an instrument of peace and security and stability in the region,” Andrabi said. “Its breach or violation, on one hand, threatens the inviolability of international treaties in compliance with international law, and on the other hand, it poses serious threats to regional peace, principles of good neighborliness, and norms governing interstate relations.”

Andrabi said Pakistan viewed the sudden variations in the Chenab’s flow with “extreme concern and seriousness,” saying the country’s Indus Waters Commissioner had written to his Indian counterpart seeking clarification in line with procedures outlined in the treaty.

“Any manipulation of river flow by India, especially at a critical time of our agricultural cycle, directly threatens the lives and livelihoods, as well as food and economic security of our citizens,” he continued. “We call upon India to respond to the queries raised by Pakistan.”

He said Pakistan had fulfilled its obligations under the Indus Waters Treaty and urged the international community to take note of India’s “continued disregard” of a bilateral treaty and to counsel New Delhi to act responsibly under international law.

Andrabi maintained Pakistan remained committed to peaceful resolution of disputes with India but would not compromise on its water rights.

In the same briefing, he also condemned an incident in which the chief minister of the Indian state of Bihar was seen in a video forcibly removing the hijab of a Muslim woman during a public interaction, followed by remarks by a minister in Uttar Pradesh who mocked the episode, saying it reflected a broader pattern of religious intolerance and Islamophobia and warranted strong condemnation.