SBP Lifts Restrictions on Dollar Imports

The State Bank of Pakistan (SBP) has changed foreign exchange policies and allowed the exchange companies to import U.S. dollars against the value of their foreign currency export shipments if required.

The aim is to bridge the gap between open market and interbank rates, aiding in easing the dollar shortage in the country.

The central bank circulated the notification, mentioning the specifics of the provision. Exchange companies can now bring U.S. dollars within five working days of their foreign currency export dispatch, provided they utilize renowned cargo or security firms. The notice stressed the need for compliance with all applicable laws and regulations, particularly those of the exporting country. It also instructed exchange companies to maintain clear and precise records of all transactions related to cash imports.

Provision’s Duration and Industry Response

The SBP’s ruling, planned to last until December 31, 2023, has one important caveat: the total amount of U.S. dollars imported by an exchange company during this period must not surpass fifty per cent of the value of its export shipments.

Zafar Paracha, the Exchange Companies Association of Pakistan’s (ECAP) general secretary, welcomed this decision from the central bank. According to Paracha, the allowance to import dollars could aid the nation in overcoming the dollar deficit, marking a positive development for the country’s economic stability. He believes the SBP’s decision will assist in reducing the discrepancy between open market and interbank rates.