The State Bank of Pakistan (SBP) has decided to remove the import restrictions with effect from January 2, 2023.
It has been stated in a circular sent on Tuesday to the presidents and chief executives of all authorized dealers in foreign exchange.
Authorized Dealers were mandated to obtain prior approval from the Foreign Exchange Operations Department SBP-BSC before initiating any import transaction pertaining to HS Code Chapters 84, 85 and certain items of Chapter 87, according to EPD Circular Letter No. 9 of May 20, 2022 and Circular Letter No. 11 of July 5, 2022.
“It has been decided to cancel the aforementioned directives as of January 2, 2023. Therefore requests for import transactions related to the aforementioned HS Codes that have already been submitted to SBP-BSC stand returned to the Authorized Dealers for proper disposal at their end.
However, the central bank added that authorized dealers may prioritize or facilitate imports under the following categories including essential imports, energy imports, imports by export-oriented industry, imports for agricultural inputs, deferred payment / self-funded imports and imports for export-oriented projects near completion.
These include products from industries that are crucial to human existence such as those connected to food (wheat, edible oil etc.) and medical (raw materials, life-saving/essential medications, surgical devices and stents).
These also include coal and petroleum group (oil and gas)-related items (for power projects based upon merit order of Ministry of Energy), raw materials, input products, and spare components needed by the sectors focused on exports, things needed as agricultural inputs, such seeds, fertilizer, and insecticides.
The prioritized categories also comprise imports paid for by foreign currency obtained by the importers through equity, project loans or import loans from overseas. The last category includes the import of plant and equipment for export-oriented projects that are nearly finished and have at least 75% of their plant and machinery from previous imports.
It instructed the authorized dealers to inform each of their constituents about the aforementioned directives.
It is important to note that the SBP’s foreign exchange holdings decreased by another $584 million on Thursday, down to a crucial $6.12 billion level. Since April 2014, SBP-held reserves have never been this low.
