SBP allows import advance payment facility for manufacturers against LCs.

KARACHI -- State Bank CLAIM OF TAX RECOVERS FROM OGDCL of Pakistan (SBP) has allowed banks to make advance payment up to 50 per cent of the value of imports against letter of credit for manufacturing concerns. Using this facility, manufacturing concerns will be able to import plant, machinery, spare parts and raw material etc. by making payment in advance. Earlier in July 2018, in light of the pressures in the foreign exchange market and deteriorating balance of payments situation, SBP withdrew the advance payment facility allowed to importers. Subsequently, some of the restrictions were relaxed to facilitate imports in critical areas related to medicines, education and defense while most of the restrictions remained in place. After the implementation of a market based exchange rate system in May 2019, pressures in the foreign exchange market have eased and the balance of payments has witnessed significant improvement as reflected in the improving current account balance, rising net foreign exchange reserves, and...