SBP revises instructions for sugar exports

The State Bank of Pakistan has issued fresh guidance on sugar shipments abroad, releasing revised export quotas for individual provinces and mills and asking lenders to carry out checks on exporters and their deals. The central bank's move follows a revision by the Ministry of National Food Security and Research, which drew on figures from the Pakistan Sugar Mills Association and corrected the names of three mills. Altogether the revised instructions cover 200,000 metric tons of sugar.

Punjab and Sindh have already endorsed the quotas for their mills, while Khyber Pakhtunkhwa's endorsement is still pending, so banks may process deals for Khyber Pakhtunkhwa mills only after the ministry confirms it. Each shipment must be paid through a sight letter of credit or upfront payment, and sea freight is the only permitted route, though no shipment deadline has been set. Export proceeds tied to letters of credit must be received within the period the SBP prescribes.

Authorised dealers must also send weekly reports on export deals and shipment progress to the FEOD director every Friday, using the prescribed format. Banks are told to confirm the bona fides of their clients and the underlying transactions in line with the applicable rules. The central bank notes that the Federal Cabinet decided allocation among mills will follow provincial quotas based on verified crushing capacity or performance, with ministries staying out of it.