State Bank of Pakistan (SBP) approved 100% advance payment for the importation by letter credit of different goods.
The SBP, confirmed in its statement that, in the interests of facilitating imports, SBP permitted the banks, on behalf of commercial importers, to pay in advance for imports of raw materials or spare parts or equivalent up to USD 10.000/-per invoice.
In addition, on behalf of commercial importers, SBP has also allowed banks to pay for imports on Open Account of raw materials and spare parts.
In addition, SBP also raised the existing 50% advance payments cap, which makes manufacturing business, imports by letter of credit of factory, equipment, spare parts and raw material, etc.
SBP allowed up to 50% of the value of imports to be paid in advance against a letter of credit in December 2019 for import issues of plants, equipment, spare parts and raw material and other goods.
The balance of payments improved significantly after the introduction of a market based exchange rate system. The current account deficit has reduced by 75% to US$ 2,15 billion in the first six months of the current fiscal year.
The latest measures, taken today, are in continuation of facilitating export-oriented industries and manufacturing concerns in the backdrop of ease of doing business and promoting exports’ growth.
These measures will further contribute in improving economic outlook of the country.