In an effort to further facilitate the exporters as well as the manufacturing sectors, SBP has allowed exporters to directly dispatch the shipping documents of their exports’ consignment to their foreign buyers without any limit, subject to conditions that the exporter’s export overdues are less than one percent and the exporter has exports of at least $5 million during the previous three years.
Earlier, exporters could dispatch the shipping documents directly to their foreign buyers for export consignments of up to $100,000, or equivalent in other currencies. This limit was in place since 2017.
Moreover, the SBP has enhanced the existing limit of $10,000, or equivalent in other currencies, per invoice allowed to banks to make an advance payment on behalf of manufacturing & industrial concerns and commercial importers for import of raw material, spare parts and machinery, to $25,000.
These measures are in continuation of facilitating export-oriented industries and manufacturing concerns in the backdrop of ease of doing business and promoting exports’ growth and will further contribute to improving the economic outlook of the country.
It is pertinent to mention here that in January 2020, SBP had taken certain measures to facilitate export-oriented industries and manufacturing concerns. These included:
- Extending the facility to make an advance payment up to USD 10,000/, or equivalent in other currencies, per invoice, for import of raw material, spare parts and machinery to commercial importers as well in addition to manufacturing & industrial concerns, allowed earlier.
- Allowing Authorized Dealers (banks) to effect import advance payment against irrevocable letter of credit, up to 100% of the value of the letter of credit, for import of plant, machinery, spare parts and raw material etc. on behalf of manufacturing concerns for their own use only.
- Extending the facility allowed to manufacturing & industrial concerns for import of raw materials and spare parts on an open account basis to commercial importers as well.
SBP Revises up Imports Limits for Industrial and Commercial Importers
State Bank of Pakistan revised the upper limit for banks to make an advance payment on behalf of the industrial imports used in the manufacturing sector to $25,000 from $10,000 and allowed exporters to directly dispatch the shipping documents to their foreign buyers without any limit.
Industries and commercial importers can now make imports of raw materials, spare parts and machinery, for use by manufacturing and industrial concerns.
Banks are allowed to effect an advance payment of up to $25,000, or equivalent in other currencies on behalf of manufacturing and industrial concerns, SBP stated. The central bank has taken the decision in an effort to further facilitate the exporters as well as the manufacturing sectors.
This is the second time in less than a year when the government has relaxed the advance payment limit on industrial imports.
In December last year, the SBP allowed advance payment of up to 50 percent of the value of imports against a letter of credit to manufacturing concerns for import of plant, machinery, spare parts and raw material etc.
