KARACHI, Feb 25: The State Bank of Pakistan has made amendment to the Mark-up Rate Subsidy Scheme for Spinning Sector which would facilitate the sector facing stress due to recession in the global market.

The SBP issued a circular on Wednesday stating that the period of mark-up rate subsidy has been enhanced from one year to two years from July 1, 2007, to June 30, 2009.

The subsidy for the period from Jan 1, to Dec 31, 2008, will be paid in March 2009.

Subsidy for six months period ending on June 30, 2009

(from Jan 1, 2009, to June 30) will be paid in July 2009 subject to necessary budgetary allocations for the financial year 2009-10.

Those spinning mills that could not avail subsidy for the first six months ending on Dec 31, 2007, due to their inability to seek settlement of their overdue loan installments or any other reason may also file claims separately to their banks for availing three per cent mark-up subsidy of the said period in March 2009, provided their default has since been settled.

Banks and DFIs can pay the amount of subsidy to eligible borrowers of the spinning sector, to be calculated keeping in view the guidelines given earlier on Oct 30, 2007, as well as above modifications.

After making payments of three per cent mark-up rate subsidy, banks or DFIs can approach the offices of

SBP-BSC (Bank) concerned for reimbursement of the same, along-with duly filled in application form on the revised format.

Banks and DFIs must ensure that all eligible cases are submitted to respective offices of SBP during the period prescribed for payment of subsidy.

“No subsidy claim will be entertained after March 31, 2009, and July 31, 2009, for the respective periods of subsidy,” said the circular.