The Ministry of Commerce has asked the State Bank of Pakistan (SBP) to issue necessary instructions to banks for opening letters of credit (LCs) of tea on a priority basis by declaring the import of tea as an ‘essential import’.
According to a letter written by the Ministry of Commerce, the Pakistan Tea Association has informed that during the upcoming month of Ramzan, domestic demand for tea will increase substantially across the country. However, commercial banks are reluctant to open LCs for the import of tea due to which supply and distribution issues of the commodity in the local market have already started to surface and it may result in a price hike of the commodity.
Therefore, in order to cater to the domestic demand for tea, the association has requested that the import of tea should be declared as an ‘essential import’ and that the same may be included in the State Bank of Pakistan’s Exchange Policy Department’s Letter No. 20 of 2022 dated 27/12/2022 via an amendment.
In view of the above, the ministry has requested that necessary instructions may be issued to the banks for opening LCs of tea on a priority basis.
It may be mentioned that tea prices have surged to Rs. 1,600 per kg from Rs. 1,100 per kg due to the shortage of tea in the local market.