The State Bank of Pakistan (SBP) is refusing to establish letters of credit (LCs) through private banks, endangering imports of electric vehicles made in the EU, according to a letter Alfred Grannas, the German ambassador to Pakistan, sent to the Federal Minister for Economic Affairs Division (EAD).
The letter provided insight into the challenging circumstances faced by Pakistan's authorized Mercedes-Benz, BMW, and Audi exporters who deal in electrified cars (EVs). It claimed that even though EVs are good for the climate, the SBP would not permit their entry.
A favorable regulatory environment for EV shipments, the German ambassador continued, is a significant development. The letter continued, "In addition, this promises to lessen Pakistan's dependence on imports of petroleum products, which account for nearly $22 billion of its estimated $72 billion overall import bill.
According to Envoy, both in terms of volume and worth, Germany is Pakistan's top business partner in the EU. He voiced concern, saying that the LCs problem might impair trade ties between the two nations.
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