ISLAMABAD: Private Power & Infrastructure Board (PPIB) has requested the State Bank of Pakistan (SBP) to make available foreign exchange for payment of Sinosure fees by Pak Matiari-Lahore Transmission Company (private) Limited (PMLTC).

In a letter to Executive Director, Financial Market and Reserve Management, SBP, PPIB has given reference to the PMLTC letter of June 24, 2022, in which the company noted that there has been a significant delay in approval by SBP of the payment request filed by the company on May 9, 2022, amounting to $ 6.31 million to Sinosure. Accordingly, the pendency of payment could result in a material breach of Sinosure policy leading to a breach under financing documents. PPIB has highlighted that non-availability of requisite foreign currency would result in the lapse of consent under the Implementation Agreement (IA) that would expose the government of Pakistan (GOP) to various potential litigations.

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According to PPIB, pursuant to provisions of the Implementation Agreement, it is the responsibility of GOP to make available through SBP the foreign currency not available through normal banking channels within the specified time for payment in foreign currency related to the projects including the payment of premiums and fees to offshore insurers and re-insurers.

PPIB has requested that the requisite payment application submitted by the Company for payment to Sinosure may be processed by SBP at the earliest.

Copyright Business Recorder, 2022