All Authorised Dealers
in Foreign Exchange,

Dear Sirs,

FOREIGN CURRENCY LOANS AND CREDITS

Please refer to the instructions contained in paragraph 61 (ii), Chapter XIII of the Foreign Exchange Manual (paragraph 47(ii) in the reprint issued vide circular letter No.49/FEP-Reg(12)-97 dated the 18^th November, 1997) on the captioned subject. In terms of the Government’s Investment Policy – 1997, long term loans can be arranged from a bank, financial institution, parent companies of multinationals or under suppliers credit. Authorized Dealers are, therefore, advised to replace the above sub-paragraph with following:

"As an exception to the above, private sector entrepreneurs may obtain foreign currency loans from banks, financial institutions, parent companies of the multinationals and as suppliers credit including credits under PAYE Scheme, not involving government guarantee, for financing foreign currency cost of the projects covered by the government’s Industrial/ Investment Policy and the instructions issued by SBP from time to time. The loans should be contracted on the best possible terms. The repayment period of such loans/credits, however, should not be less than five years."