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State Bank withdraws condition on opening LCs for import payments

Central bank says letter of credits for import payments can be opened from Jan 2
Published 29 Dec, 2022 06:09pm
<p>Representational image</p>

Representational image

The State Bank of Pakistan (SBP) has lifted a ban on imports withdrawing the condition of prior approval for banks in processing the import payments. The central bank said that the letter of credits (LCs) for the import of goods could be opened from January 02, 2023.

The SBP, in May 2022, in pursuance to the federal government’s directions imposed restrictions on the opening of LCs for the import of goods falling under Chapters 84, 85, and certain items in 87 of the Pakistan Customs Tariff.

The restrictions were imposed in order to prevent dollar flight and rescued the local currency from massive depreciation.

Traders in Karachi’s Juna Market, a wholesale market of commodities, expressed serious concerns over the ban on imports, with the laborers sitting workless due to the shortage of goods in the market.

Wholesale dealers said that most of the containers were stuck at the port due to which there was a shortage of pulses in the market.

They said that the central bank instructed the commercial banks that LCs should be opened from January 2. But, they added, the importers were not satisfied with this decision.

Former president of the Karachi Chamber of Commerce, Ibrahim Kasambi, said that the decision to open the LCs was taken on the International Monetary Fund (IMF) condition.

“Clearance of containers will take time,” he added.

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