The SBP took a big step to control the value of the dollar


The SBP took a big step to control the value of the dollar

KARACHI (Daily Pakistan Online): The State Bank of Pakistan (SBP) has imposed a 100% cash margin on the import of 114 more items to control the value of the dollar.

According to a circular issued by the SBP, after imposing 100% cash margin on the import of 114 items, the total number of items on which 100% cash margin has been imposed has increased to 525. To improve the balance of payments, Bank financing for imported vehicles has also been banned in the past to support and stabilize foreign exchange reserves. Experts say the addition of 114 items to the list of items included in the 100 per cent cash margin requirement on imported goods is the SBP’s second major move.

It should be noted that cash margin is the amount that the importer has to deposit in his bank to open a Letter of Credit (LC) for the commencement of the transaction and it is equal to the total value of the imported goods. Cash margins increase the cost of imports as the dollar becomes more expensive, which discourages imports.

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