KARACHI: The concerted efforts of State Bank of Pakistan (SBP) towards financial assistance to further develop and promoting export potential of marble and granite sector of the country would definitely yield results.
The industrial loans to the sector through directing commercial banks and from Small and Medium Enterprises Development Authority would cast positive outcome for enhancing production capacity along with insertion of modern machinery in export-oriented industry.
The realistic and workable loan slab level policy of SBP can bring revolutionary transformation in the onyx industry, executives of All Pakistan Marble Mining Processing Industry and Exporters Association (APMMPIEA) have maintained.
An immediate financial assistance of Rs 10 million on soft term basis to loan applicants of the sector for machinery up-gradation by SBP would like an elixir.
During an interaction with SBP officials, the sector representatives have discussed ways and means in length for the development of onyx and granite industry.
During the discussions financial assistance based on special terms and conditions on collateral free also came under review.
Chairman APMMPIEA Sanaullah Khan put forward suggestions based on the discussion that happened during last meeting.
It is relevant to mention here that commercial banks and financial institutions will offer same financial assistance to the level of Rs 10 million.
The sector people on the loan offer requested for the clarity in this offer as they asked what would be mark up rate whether flat mark up rate, is Islamic banking window available for this assistance, what will be the minimum and maximum tenure of this loan, what will be the early maturity policy and whether it is restricted only to production machinery or any kind of machinery related to the sector not limited to production only.
The APMMPIEA people have asked SBP that what would be the loan repayment schedule, who would make the payment to machinery supplier and who keep the ownership of the machines or would the machinery purchase be done on hypothecation basis.
In case machinery amount is over and above the allocated amount then what would be formula or policy and what kind of documentation would be required to qualify for the assistance.
This is mainly due to the fact that rupee-dollar parity has been aggressive for a while, which makes machinery purchasing difficult in a certain budget.
APMMPIEA can provide list of essential machines and estimated pricing from different vendors to help SBP to understand their issue.
For instance a machine known as marble gangsaw and is used for blocks cutting to convert them into slabs costs excluding duty/taxes $100,000-$125,000, depending on the make and origin. Besides cost of machinery accessories and installation ($30,000 and $30,000 respectively) are additional burden.
This information would help to consider and to revise loan offer and it is based on realistic grounds, they maintained.
They have expressed confidence that on these grounds and information being shared would make follow up meetings more conclusive.
Published in Daily Times, July 14th , 2017.