Realisation of export proceeds: LCCI exhorts SBP to withdraw recent circular immediately

LAHORE: The Lahore Chamber of Commerce & Industry noted on Saturday that the State Bank of Pakistan is passing anti-export laws that have the potential to reduce the country’s exports to at least half of their potential level.

In a statement, the LCCI president noted that the SBP’s assertion that exporters are stashing their money abroad is entirely incorrect and that this false assumption is having an impact on the policies being formed.

The exporters from different sectors including meat, carpet, auto, agriculture, leather and textile sector, led by former president LCCI Shahid Hassan Sheikh, showed their serious concerns over the notification issued by the SBP.

The LCCI has urged the State Bank of Pakistan to withdraw recently issued Circular No. 02 of 2023 on March 31, 2023 regarding the realisation of export proceeds.

LCCI president announced a committee led by former president Shahid Hassn Sheikh and consists of representatives of different exporting sectors. The committee will form suggestions including budget proposals and suggestions for the State Bank and different other departments related to exports. The LCCI then takes these suggestions to high levels having expert opinion.

Kashif Anwar said that every exporting sector has its own specifications, e.g. some are highly value added and have long shelf life like carpets and others are dealing in perishable items. In light of their product diversification, shelf life and other factors, the export proceed time should be determined after thorough consultation with those sectors who are dealing in time bounding items.

LCCI president further said that according to the circular, in case of delays in bringing the export proceeds into the country, there will be fines ranging from 3% to 9% on realised export proceeds.

He was of the view that this measure will adversely impact the exporters who are already facing steep and multi-dimensional challenges due to the rise in cost of doing business. This measure is completely unjustified as there are often delays in export proceeds due to the circumstances which are well beyond the control of exporters.

He said that this measure will ultimately affect the competitiveness of our exports in the international market. The LCCI requested the State Bank of Pakistan to review this measure in the best interest of our exports.

The LCCI president said that 100% raw material of meat exporting sector is produced in Pakistan. Each sector has separate export problems. He said that the committees, consisting of all exporting sectors should be formed

He said that the exporting sectors are stigmatized internationally, when they are blamed that they are involved in money laundering.

He said that the interest rate is 21% and the businessmen are thinking whether to bring the money to the market or keep it in the bank to earn profit.

Many sectors are importing up to 50% raw material how can they keep money out. He said that the exporting sector has made serious reservations and said that this is an anti-export notification. There cannot be a single notification for value added sectors, perishable items and products with long shelf life.

The LCCI President said that meat, carpet, auto, agriculture, leather, textile sector representatives showed their serious concerns over the notification issued by the SBP. He said that there are sales tax refund, customs refund, DLTL and incremental funds are pending that should be released at the earliest.

Shahid Hassan Sheikh said that this notification is against the stakes of export-oriented industry that should be withdrawn immediately.

Copyright Business Recorder, 2023