He said that SBP has continued to provide incentivised financing schemes for exporters in lieu of BMR and setting up new infrastructures for plant machines and grain storage solutions which definitely helps the export sector immensely, but due highly volatile exchange rates, the planned expansions bring in uncertainty thus the volatility deterring the incentives provided by SBP.
Therefore, he requested governor SBP that exporters particularly rice sector should be allowed forward exchange rates booking against import of plant machinery and grain storages and allied equipment, in order to have sound expansion planning. Suleman mentioned that Federal Board of Revenue (FBR) has announced to issue the bonds to rice exporters against their Sales Tax Receivables and accordingly accepted by exporters, however, these are not yet tradable instruments. He requested that since these bonds will be issued in lieu of Payables by the State to exporters, SBP may instruct National Bank of Pakistan to commence purchasing these bonds at face value. This will help the exporters to manage their liquidity.
Convener FPCCI Sanding Committee on Rice also informed that commercial banks are refusing to certify Form-E when product value is higher than the listed Minimum Export Price (MEP). During off season especially for premium varieties such as IRRI-9, PK-386, Basmati, 1121 and similar, the price of rice increases due to premium derived from high cooking results.
"We have received multiple complaints by REAP members that where price per unit is higher than the listed MEP, commercial banks are refusing to certify the Form-E," he added. There is need to be clarified here that the enforcement of Minimum Export Price was implemented on the suggestion of REAP to TDAP to address the menace of under invoicing, but there should be no bar on higher values, on the contrary government should encourage premium value exports by fetching higher value of per unit price, he urged.
Suleman said that exporters are making efforts to enhance rice exports up to $5 billion dollar in next few years, however there is need to address the issues being faced by the rice trade. During the meeting, governor SBP assured to facilitate the rice exporters to earn more foreign exchange for the country.