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December 23, 2010

Textile sector

National

December 23, 2010

KARACHI: The State Bank of Pakistan (SBP) has allocated Rs482 million against pending claims with respect to export finance mark-up rate facility and mark-up rate support for the textile sector, central bank Chief Spokesman Syed Wasimuddin said on Wednesday.
“The amount would be reimbursed against pending claims and those claims, which were not entertained due to errors or non-fulfillment of requirements,” he said.
The Textile Ministry had recently announced that as part of Rs42 billion bailout package announced for the industry, Rs7.5 billion had been transferred to the State Bank for payment to textile industrialists and exporters as research and development and duty drawback claims.
The State Bank on Wednesday issued a circular, asking commercial banks and development finance institutions to approach the central bank for processing of pending claims with respect to export finance mark-up rate facility and mark-up rate support for the textile sector against long-term loans.
The circular said that the Ministry of Textiles had released necessary budgetary allocation for 2010/11 to reimburse up to 32 percent out of 40 percent paid claims under the export finance mark-up rate facility and pending claims under both the schemes for the period from September 1, 2009 to February 28, 2010.
“The remaining eight percent of the export finance mark-up rate facility, for the period 01-09-2009 to 28-02-2010, shall be released on receipt of necessary budgetary allocation/instructions from the Ministry of Textiles and Ministry of Finance,” it added.
The central bank has reimbursed 100 percent mark-up rate support against long-term loans and 60 percent export finance mark-up rate facility during FY10 to offices of SBP-BSC (Bank), for six months period from September 1, 2009 to February 28, 2010.
“However, a few claims were pending with the offices of SBP-BSC due to non-fulfillment of certain terms and conditions of schemes and or other omissions and

errors made by the banks, DFIs or borrowers,” it added.
Following the release of the budgetary allocations, banks and DFIs have been advised to approach respective offices of SBP-BSC within 20 working days with the requisite information and/or to rectify omissions/errors to enable them to process the pending claims for the abovementioned six months period.
Moreover, the offices of SBP-BSC will also release export finance mark-up rate facility to the extent of 32 percent of the total claims against the cases, which have been found in order and where 60 percent reimbursement has already been made, it said.
Banks/DFIs would immediately pass on this additional reimbursement to the concerned exporters/borrowers, the circular added.

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