SBP facility for carpet exporters

The State Bank of Pakistan (SBP) has extended the financing period for carpet and rug exporters up to 270 days from 180 days for realization of their export proceeds.

Carpets and rugs specially hand-knotted and man-made require more time for their manufacturing as compared to other products and they require financing for longer duration, the SBP says in a circular BSD no. 40, issued to all banks on Wednesday.

Exporters of carpets and rugs are facing serious difficulties in realization of export proceeds, the bank said.

Keeping in view this aspect, it has been decided to relax the provisions of the Export Finance Scheme (EFS), where export finance has been, or will be, availed under Part I of the EFS, the SBP said.

In case of fresh finances granted by banks to exporters, the facility will be available for 270 days to the above exporters, 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 withdrawal of the finance.

SBP said in case export finance already availed by exporters under Part I of the EFS, banks may allow an additional period up to 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.

Exporters said the SBP's decision will go a long way in timely realization of export proceeds and minimize the problems that the exporters have been facing after September 11 incident in the USA, resulting in slow down of orders from foreign buyers.

Exports of carpets rose by 39 per cent to $21 million in September 2001 from $15 million in August 2001. However, exports in September 2000, were $24 million, showing a decline of 14 per cent as compared to September 2001.

Orders for fish, shrimps drop

Traditional western buyers of shrimps and fish from Pakistan are switching over to cheaper imports from other countries, and purchase orders have plummeted by 30 to 40 per cent after September 11 , industry sources said.

The economic slowdown in Europe and America has adversely changed the consumption pattern, reducing the demand of various products. Cheaper goods are more in demand.

Exporters claim that October is our peak season for export of shrimps but poor demand from the western countries have slashed the arrival of orders by at least 30-40 per cent.

"We are being asked to ship shrimp at much lower price than the rates offered by India, Indonesia and Bangladesh. Our exports have virtually become uncompetitive in world markets," President Pakistan Seafood Industries Association (PSIA), Hanif Khan told on Wednesday.

Cotton export may earn less forex

Cotton exports during the current season may not hit the last year's high mark of $139 million owing to steep decline in world prices because of an expected production glut and falling consumer demand.

World cotton prices have, since the beginning of the new cotton season from September 1, declined to 15-year low level of 30 cents per lb, which in turn, could well mean lower foreign exchange earnings despite a larger exportable surplus, exporters claim after calculating the difference between the last and current season's selling prices.

Refinance at 10pc by Dec, says Ishrat

The State Bank Governor Dr Ishrat Hussain has said the rate of export refinance will be cut down to 10 per cent from the existing 12 per cent by December to boost exports from Pakistan and to help exporters who have obtained duty free access to the EU markets from January 2002.

In his lecture at the Government College, Lahore, on Wednesday, the governor said Pakistan's economy had been hit hard after the September 11 events as it became the frontline state in the global war against terrorism. However, he was hopeful that the economy would start recovering in the third quarter of the current financial year.

Free trade pact with Sri Lanka soon

Pakistan and Sri Lanka are close to signing a comprehensive free trade agreement to promote exports and imports between the two countries, a highly-placed source in the ministry of commerce told on Tuesday.

The government has constituted a delegation comprising officials of the ministry of commerce, EPB and Central Board of Revenue, who will leave for Colombo in mid-November for carrying out consultations on free trade with their counterparts and consequently draft the agreement, the source said.

Pakistan, Japan trade discussed

Commerce Minister Abdul Razak Dawood on Saturday said that Japan was a major trading partner of Pakistani exports and collaborating in automotive industry.

The minister was talking to Sadaaki Numata, ambassador of Japan, who called on him and discussed with him matters pertaining to bilateral trade.

The minister gave an overview of the economic and trade activities. Razak said that the incident had affected Pakistan's export adversely.

Gold imports resume after four months

Gold imports have been resumed after remaining suspended for four months and one of the three licensed importers in the country has imported 10,000 tola in the last two days.

"I have imported 10,000 tola gold from Dubai in view of declining trend in global prices," chairman Tessori Trading Company Limited Kamran Khan told on Saturday.

Pakistan, however, used to import 10,000 tola per day. "We have initiated the imports to check the market and we may increase the quantum in coming days depending on the market situation, he said.