KARACHI, Aug 17: The State Bank, which holds exporters responsible for distortions in export finance scheme and cut financing facility announced in the monetary policy for July-December 2007, said on Friday a draft was being made to facilitate exporters.

The SBP issued a release saying the SBP has decided to launch a new financing scheme titled “long-term financing facility (LTFF) for plant and machinery” for locally produced and imported plant and machinery by specific sectors to promote export-led growth.

This facility will be available through approved Participating Financial Institutions (PFIs) i.e. banks and Development Finance and Institutions (DFIs).

Under this facility, exporters can avail financing for procurement of new imported and locally manufactured plant and machinery for their export-oriented projects.

LTFF will be guided by an overall yearly limit within which PFI limits will be fixed based on their financial capacity and strengths.

PFIs will entertain exporters on first-come first-served basis. The SBP invited feedback on this issue from stakeholders.

The new monetary policy which was introduced on the last day of previous month shifted 30 per cent export financing towards commercial banks.

Exporters were extremely unhappy with this situation and wanted to reverse the SBP’s decision.

The new draft for exporters could be an alternative to exporters who were not satisfied with the SBP decision.