Central bank sets payment, shipping and reporting conditions for sugar exports approved by the ECC and Federal Cabinet.
KARACHI: The State Bank of Pakistan (SBP) has authorised banks to process export requests for 200,000 metric tonnes of sugar under a newly approved quota, following approval by the Economic Coordination Committee (ECC) of the Cabinet and subsequent ratification by the Federal Cabinet.
In a circular issued to presidents and chief executives of authorised dealers in foreign exchange, the SBP referred to a letter from the Ministry of National Food Security and Research (MNFSR) dated September 23, 2026.
The ministry confirmed the ECC’s approval of the sugar export quota, subject to specified terms and conditions. The MNFSR subsequently issued operational modalities on October 1, while the Pakistan Sugar Mills Association (PSMA) provided mill-wise quota allocations in its September 28 letter.
The SBP instructed authorised dealers to process requests for financial instruments from eligible sugar exporters strictly in accordance with the mill-wise quotas allocated by the PSMA.
According to the central bank, exports under the approved quota must be made against sight letters of credit or advance payment. It further specified that the sugar shipments would be permitted only by sea.
The SBP clarified that no specific deadline has been set for shipment of the approved sugar exports. However, export proceeds against letters of credit must be realised within the regulatory timeframe prescribed by the central bank.
Authorised dealers have also been directed to submit weekly details of sugar export transactions and shipment updates to the Director, Foreign Exchange Operations Department (FEOD), SBP Banking Services Corporation, Karachi.
The reports must be submitted through the prescribed format by 4pm every Friday.
The central bank further instructed authorised dealers to conduct appropriate due diligence and satisfy themselves about the bona fides of exporters and the underlying transactions in accordance with applicable regulations.
Banks have been advised to communicate the instructions to all relevant stakeholders and ensure strict compliance with the requirements governing the 200,000-tonne sugar export quota.