KARACHI, Aug 21: The ministry of finance has allowed Research and Development (R&D) support payments on shipments made up to June 30, 2008. The decision is in line with the notifications issued by the ministries of commerce and textile industry.

The controversy over the payment of R&D to textile exporters cropped up when the State Bank issued a notification in June that only those bills of shipments received up to June 25, 2008 will be eligible for R&D payment.

However, the exporters agitated over the unilateral move of the central bank and argued that since the two ministries had allowed payment of R&D support on bills submitted up to June 30, therefore, there was no need to change the rules for no valid reason. The manufacturers-cum-exporters of value-added textile sector pursued the matter with the ministry of finance and finally Finance Minister Naveed Qamar accepted their plea.

According to a notification issued by finance division on August 16 it has directed the State Bank to entertain the R&D claims for shipping bills received up to June 30.

It has further stated that the payments may be made in according with the provisions and procedures under the relevant SROs issued by the ministries of commerce and textile industries. All these payments will be debited to the government account as per the previous practice, the notification added.

Towel Manufacturers’ Association (TMA) chairman R&D committee appreciated the finance minister for taking timely decision, which will help exporters to file claims against the time-barred cases pending with the banks.

This would mean that the exporters will have to apply for R&D support claims for the period between June 25 to 30, and this would only be possible after the State Bank issues directives to the banks in the regard.