SBP allows banks to process 200,000-tonne sugar exports under mill-wise quotas

The State Bank of Pakistan has instructed commercial lenders to handle export files from qualifying sugar mills covering 200,000 metric tonnes, according to Profit by Pakistan Today. Lenders must allocate processing matching each mill's share of the quota, while meeting specified payment, dispatch and reporting conditions. The directive followed the federal government's move to permit sugar shipments abroad and the completion of implementation procedures.

Lenders will act on mill requests consistent with allocations set by the Pakistan Sugar Mills Association, and they must confirm that issued instruments match those quotas. Export deals qualify only when backed by sight letters of credit or prepayments, with cargo moving by sea alone. Proceeds tied to letters of credit must come in within the timeframe the SBP has specified, and banks must send weekly transaction and shipment data by 4pm every Friday.

Banks have also been told to conduct due diligence on exports and verify the bona fides of clients and underlying transactions under applicable rules. The quota has been spread across 79 mills in several provinces, with every mill's portion linked to the volume of cane it crushed. The central bank has not set a deadline for shipments.