KARACHI (November 14 2002) : For the facilitation of exporters, the substitution of the Contracts, or LC, has been allowed up to a maximum period of six months from the date of disbursement of the loan, said a circular issued by the State Bank on Wednesday.
The circular explains that settlement and execution of the last substitution Contract, or LC, should not extend beyond six months from the date of disbursement of loan.
Authorised Dealers will have to ensure strict observance of these instructions, the circular said.
In case an exporter fails to fulfil the obligations under the final Contract/LC, or export order is cancelled, he may approach the State Bank, through the Authorised Dealer, with valid reasons and documentary evidence, with the request to allow purchase of the outstanding loan amount, for settlement purpose, from the inter-bank market.
