EPD Circular Letter No. 16 of 2026, dated 28 October 2026 · Reviewed 29 October 2026. The original instrument and subsequent amendments govern.
The 28 October revision removes the outstanding provincial endorsement obstacle for eligible Khyber Pakhtunkhwa sugar mills. It does not increase the national 200,000-metric-ton export permission or relax the existing payment, shipment and reporting conditions.
What changed on 28 October
SBP records that the Ministry of National Food Security & Research, through its memorandum dated 25 October 2026, confirmed endorsement of Khyber Pakhtunkhwa mills' quotas by the provincial government. Authorised dealers may now process export transactions of eligible KP sugar mills against their respective quotas. Previously, EPD Circular Letter No. 15 of 13 October permitted processing for eligible Punjab and Sindh mills but stated that KP endorsement was awaited.
The circular expressly preserves the conditions of EPD Circular Letter No. 15 and the relevant Ministry memorandum dated 9 October 2026. The change is therefore geographic eligibility within existing mill allocations, not a new open-ended permission for any mill or exporter.
Payment, shipment and reporting conditions remain
Under EPD Circular Letter No. 15, exports must be against a sight letter of credit or advance payment and shipment must be by sea. The circular states there is no shipment deadline, but export proceeds against letters of credit must be realised within SBP's prescribed regulatory period. The absence of a shipment deadline does not remove quota, payment or foreign-exchange compliance obligations.
Authorised dealers must submit transaction and shipment updates weekly to the specified SBP-BSC foreign-exchange operations channel by Friday at 16:00, using the prescribed reporting format. They must also perform due diligence on the exporter and underlying transaction. EPD Circular Letter No. 16 does not dispense with those requirements.
Affected businesses and commercial implementation
The direct beneficiaries are KP sugar mills whose quotas have been endorsed, and their authorised dealer banks. Freight forwarders, trade-finance providers and overseas buyers may be affected through transaction scheduling, documentary terms and vessel arrangements. The bank should check the actual mill-wise allocation and supporting Ministry documentation before processing.
Export contracts should align the payment method and sea-shipment requirement with the banking documentation. A commercial timetable should allow for documentary verification and the regulatory proceeds-realisation period. Exporters should not treat the national 200,000 MT authorisation as an individual entitlement or assume that a bank can exceed the allocated quota.
Why this development matters
The practical change is that eligible KP mills can now transact within their previously conveyed allocations. Banks should implement the new eligibility without weakening the controls that still apply to every shipment.
Specific steps for affected organisations
- Verify that the exporter is an eligible KP sugar mill and identify its specific endorsed quota.
- Use a sight letter of credit or advance payment and arrange sea shipment only.
- Apply the prescribed foreign-exchange proceeds-realisation period; do not infer unlimited settlement time from the absence of a shipment deadline.
- Submit weekly bank reports by Friday 16:00 and retain the quota and due-diligence records.
- Check the Ministry memoranda and any later SBP revisions before transaction execution.
Timing and legal status
Issued 28 October 2026; operative according to its terms without a later commencement date specified in the circular.
The circular does not publish a new mill-by-mill quota table in its short text. Exact quantities must be checked against the referenced Ministry and PSMA allocation records.
SBP EPD Circular Letter No. 16 of 2026 (original circular)
Related official instructions
EPD Circular Letter 15/2026 (13 October) and EPD Circular Letter 14/2026 (2 October) set out the continuing export conditions.