011024

STATE BANK OF PAKISTAN BANKING SUPERVISION DEPARTMENT

BSD Circular No. 40
All banks

Dear Sirs/Madam

PART I OF THE EXPORT FINANCE SCHEME RELAXATIONS TO EXPORTERS OF CARPETS AND RUGS

Under the existing instructions on the export finance scheme, finance is available to exporters across the board for 180 days. Since carpets and rugs, specially "hand knotted" and "man made" require more time for their manufacturing as compared to other products they require financing for a longer duration. Moreover, exporters of carpets and rugs are facing serious difficulties in realization of export proceeds.

2. Keeping in view this aspect, it has been decided to relax the provisions of the Export Finance Scheme where export finance has been, or will be, availed under Part-I of the Export Finance Scheme by them. Henceforth a total period of upto 270 days (both pre-shipment and post shipment) for availing of finance will be admissible for export of carpets and rugs.

3. In case of fresh finances granted by banks to exporters, the facility will be available for 270 days to the above exporters, however, banks will have to adjust the finance within a maximum period of 180 days, and allow refinance for an additional period of 90 days, provided shipment has been made by the exporters within a period of 180 days after the withdrawal of the finance. In case of export finance already availed of by exporters under part-I of the Export Finance Scheme, banks may allow an additional period upto 90 days for repayment of export finance availed of for export of carpets and rugs only, except where export proceeds have been realized earlier by the exporters.

4. For this purpose the exporter/bank desiring roll over of the facility shall be under obligation to submit Annexure "D" as prescribed under the scheme within a maximum period of 180 days of availing of the finance giving therein the particulars of shipment. The SBP Office concerned shall allow roll over of refinance for a period of 90 days against the already submitted loan documents.

5. Other instructions on the subject shall remain unchanged.

Please acknowledge receipt.

Yours faithfully,

Sd-
(KAZI ABDUL MUKTADIR)
Director