Circulars/Notifications - Banking Supervision Department  
 BPRD Circular No. 2
January 9, 1998 

All Banks / DFIs

Dear Sirs,

CONCESSIONARY FINANCE FOR DOMESTIC SALES 

OF LOCALLY MANUFACTURED MACHINERY 

FOR THERMAL HYDAL POWER PLANT

  1. Please refer to the captioned scheme circulated vide ISC Circular No. 07 Dated. the 16th August, 1995.
  2. Under the existing provisions of the captioned scheme, if the landed cost of imported components used in a machine/equipment does not exceed 80% of the Ex-factory/Show room price and the landed cost of the imported components. Likewise the rates of profit earned by the financial institution on finance provided under the scheme for pre-delivery /post delivery purpose shall not exceed 13% p.a.. Where refinance is obtained from the State Bank of Pakistan, the bank will share in the overall profit (before tax) of the financial institutions concerned, subject to the maximum of 11% and 10.5% on annual basis, on refinance granted for pre delivery and post delivery purpose respectively.
  3. It has now been decided to substitute Para (b) of the captained scheme circulated vide Circular referred to above with the following:-

b (i) Individual machine / equipment using up to 20% landed

cost of imported components of the Ex-factory / Show

room price of such machine / equipment will be eligible for

100% financing under the scheme.

b (ii) For individual machines and equipments using more than

20% imported components as described in b ( i ) above,

the entitlement for refinance would be determined after

deducting the landed cost of imported items used in

manufacturing the machinery from the Ex-Factory / Show

room price of the machinery so manufactured.

  1. Likewise the maximum profit to be earned by a financial institution on finance extended under t he scheme has been reduced to 11% p.a. Where refinance is obtained from State Bank of Pakistan the Bank will share in the overall profit (before tax) of the financial institutions concerned, subject to the maximum of 9% on annual basis, on refinance granted for pre delivery and post delivery purposed respectively.
  2. The rate of find on account of non-shipment / short shipment / delayed shipment has also been reduced to paisa 28 per thousand or part thereof.
  3. The validity of the Scheme has also been extended up to 30th June 1998.
  4. Other terms & conditions of the Scheme shall, however, remain unchanged.

Please acknowledge receipt.



Yours faithfully,
Sd/-
(Mansur-ur-Rehman Khan)
Director

       
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