KARACHI: The State Bank of Pakistan (SBP) has announced a 100 percent cash margin on the import of 177 items with immediate effect to reduce the pressure on the exchange rate. The cash margins deposited by importers on all items will be non-remunerative.

The State Bank has taken this decision after massive decline in the country’s foreign exchange reserves and volatility in the exchange rate, which was Rs190 against the US dollar in the open currency market on Thursday.

The SBP has advised banks to obtain 100 percent cash margin on the import of 177 items with immediate effect and the cash margins on these specific items will remain in place till December 31, 2022.

Currency values in terms of Special Drawing Rights

To ensure effective monitoring, banks are required to submit details of cash margins, applicable on all items, collected from importers on a monthly basis, as per prescribed format.

Data for the ongoing month should be reported to the Statistics & Data Warehouse Department latest by the 10th of the following month. Further, monthly data for the period September 2020 to March 2022 is required to be submitted on the same format latest by June 30, 2022.

According to SBP, all other instructions contained in the aforementioned circulars shall, however, remain unchanged.

Copyright Business Recorder, 2022