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KARACHI: The State Bank of Pakistan on Friday advised banks to begin processing sugar export requests under a 200,000-metric-tonne quota approved by the government, requiring that shipments be by sea and paid for through sight letters of credit or advance payment.
The SBP said in a circular to authorised dealers (banks) that the Economic Coordination Committee of the Cabinet has allowed the export of 200,000 metric tonnes of sugar with certain terms and conditions, and that the Cabinet has ratified the decision.
The circular cited a September 23 letter from the Ministry of National Food Security and Research, followed by an October 1 office memorandum setting out how the quota would be implemented.
Banks must process financial instrument requests in line with mill-wise quotas allocated by the Pakistan Sugar Mills Association in a September 28 letter, the SBP said.“The export of sugar shall be made against a sight letter of credit or advance payment,” it added.
“The shipment of sugar shall only be made by sea.”The central bank said there will be no deadline for shipments. Proceeds from exports made against letters of credit must be realised within the time limit prescribed under the existing SBP regulations.The bank said authorised dealers must carefully check each transaction and make sure that the client and the transaction are genuine and comply with the relevant rules.
