The Head/ Principal Offices of all

Authorized Dealers in Foreign Exchange

Dear Sirs/Madam,

Review /Update on Sugar Situation-Sugar Export

1. Attention of Authorized Dealers is invited to Ministry of Commerce’s Office Memorandum (O.M) No. 7(2)/2012-E-III (Vol-VIII) dated April 3, 2014 (copy enclosed) on the captioned subject in terms of which Government of Pakistan has;

1. Allowed export of a total of 250,000 MT of sugar through sugar mills from surplus sugar stock before June 15, 2014 subject to following conditions;
   1. Quota may be allocated on first come first serve basis.
   2. Export may be made against irrevocable letter of credit or a contract with 25% non-refundable advance payment.
   3. Shipment may be made within 45 days of the registration of contract with the SBP, and the non-refundable advance payment to be forfeited in favor of Government of Pakistan in case of non-Performance
2. Directed the Minister for National Food Security & Research, Minister for Industries & Production and concerned Secretaries to ensure timely payment of outstanding dues to sugar cane growers by the sugar mills through Cane Commissioners/Provincial Governments.

2. Accordingly, the Authorized Dealers are advised to process the cases as per following mechanism;

1. The bank will ensure receipt of a minimum 25% of total contract value as advance payment (evidenced by advance payment voucher, swift message and reporting schedule/credit advice) or obtain an irrevocable L/C from the buyer
2. Exporter must ship the sugar within 45days from the date of SBP approval.
3. Banks will forward the requests of Sugar Mills for SBP approval along with the attested / authenticated copies of the following documents:
   1. Clearance issued by the concerned Cane Commissioner to the effect that concerned sugar mill has cleared outstanding arrears to be paid to the growers
   2. Contract
   3. E-Form
   4. Irrevocable L/C or advance payment voucher, swift message and reporting schedule /credit advice, as the case may be.
4. All requests should be addressed to the Director, Exchange Policy Department, State Bank of Pakistan, I.I. Chundrigar Road, Karachi with reference to this F.E. Circular Letter.
5. SBP will allow permission against each E-Form on first come first served basis.
6. Banks will submit sugar export update to Director, Exchange Policy Department on daily basis as per the format given below at [email protected] failing which SBP will initiate action under related rules and regulations:

3. Incomplete requests will not be considered.

4. Authorized Dealers are advised to bring the same to the notice of all their constituents.