KARACHI, Jan 1: The State Bank of Pakistan is updating the foreign exchange manual and incorporating all the changes proposed in foreign exchange circulars and letters to be issued up to end this year (31-12-2002).

An 11-page annexure of the SBP circular issued on Tuesday spells out changes made in the chapter 2,3,4, 5, 6, 8, 12, 13, 14, 15, 16, 17 and 19.

“Some of the existing paragraphs have been redrafted to make them clearer and the procedural changes made in the existing provisions will become effective with the issuance of the revised manual on February 1 next,” the SBP circular said.

In another circular the SBP has allowed the banks to include export and import financing in the 20 per cent cap of the foreign exchange deposits mobilized under FE circular 25.

In a de-dollarization bid, the banks have been asked to maintain foreign exchange currency account deposits 20 per cent of the rupee deposits. The State Bank wants the banks to mobilize the rupee deposits and contain dollar deposits.

Under the amendment, the computation of 20pc cap on FE 25 deposits against local currency deposits, the foreign currency deposits utilized for financing of trade activities will be netted off.

“Foreign currency deposits, mobilized under FE 25 schemes, after netting off deposits utilized to finance trade related activities such as financing against import and export documents, should not at any point exceed 20 per cent of the local currency deposits of the banks and NBFIs at the close of business on the last working day.

Banks and NBFIs, which have not been able to comply with new requirements, have been advised to ensure it by next July.

Effective from Jan 5, all banks will now report the equivalent Pak rupee amount (with a foot note of dollar equivalent) of FE 25 deposit utilized for trade related activities.