KARACHI - The State Bank of Pakistan has issued instructions to banks/ development finance institutions (DFIs) regarding processing of claims for provision of “Mark-up Support” and “Investment Support” to textile industry under the Technology Up-gradation Fund (TUF) Scheme of the Federal Government, said SBP circular issued here on Thursday.
This scheme, which has been notified by the Ministry of Textile Industry, will encourage investment for up-gradation of machinery and technology in textile industry.
Banks/DFIs shall process the claims for “Mark-up Support” and “Investment Support” from Textile Industry, duly registered with Ministry of Textile Industry. However, they have been instructed to forward the eligible claims after their scrutiny along-with Certificate of Commissioning of machines and commercial operations issued by ministry, separately for each Support, strictly in compliance with the terms and conditions prescribed in ministry’s notifications/ TUF Scheme, to the offices of SBP-BSC.
Under the scheme, the claims for ‘Mark-up Support’ may be submitted on ‘Form TUF-I’ along-with the documents/ papers prescribed in claim form. Only Loans disbursed on or after 01-09-2009, are eligible for Mark up Support. Maximum amount of loan eligible for calculating subsidy will be up to C&F value of eligible machinery/technology mentioned in LC retired through bank loan.
Under the scheme, the equity investment means financing of imported machinery and technology through own sources and that will be determined from C&F value of eligible machinery/technology mentioned in LC retired for this purpose. SMEs can also import eligible machinery/ technology through contract.
However, to claim Investment Support, such SMEs shall be required to produce reliable evidence about actual import of requisite machinery/ technology and payment to the foreign supplier through banking channel.
State Bank has strictly instructed the concerned banks/ DFIs that they should ensure as per their own arrangements, including an undertaking from the beneficiary of this scheme, that facilities are not availed in duplication.