KARA CHI- The small and medium rice exporters have demanded of the State Bank of Pakistan to ask commercial banks for providing Pre-Shipment Export Refinance Facility (ERF) to SME rice exporters solely against the condition of pledging of stocks without seeking collateral security. Zahid W. Khawaja, founder member of Union of Small and Medium Enterprises while talking to The Nation said that the Post Shipment ERF could also be provided against export documents while contrary to that the banks are acting as "Sahookar" (money lender) who could often demands that a person should mortgage his property. This is against the interest of SME exporters who cannot provide collateral security but can pledge rice stocks if margins are reasonable with maximum 20%, he said. It must be kept in view that Basmati is the only rice product where value addition is possible by simply storing it in Pakistan for a year instead of selling it as fresh crop to others who store it and then compete with Pakistan-based matured stocks, he said, adding that overseas interest rates are lower and therefore, our exporters are under pressure to export fresh rice agri-product to meet SBP requirements. All other rice varieties are being sold fresh. Basmati is preferred old or matured for about one year. He advised SBP to consider allowing ERF to Basmati exporters where funds should be given for export performance in 365 days instead of current 180 days. "Therefore, with very low financial cost to the exchequer locally, we can generate almost double value of Basmati exports in this way", he said.   He further stated that we must try to create an encouraging playing field to promote rice exports; we must also ensure that negative developments that create unhealthy competition and also give rise to possibility of enhanced corruption must be resisted tooth and nail by all in the rice chain of Pakistan. He was of the opinion that if government wants to purchase paddy/rice for food security purposes through TCP or PASSCO then it must be with clear and strongly visible guarantee to trade that rice from such strategic stocks will not be allowed for export by anyone to anyone including G2G deals under any circumstances. Such stocks shall remain solely for domestic consumption purposes through Utility Stores at low prices etc. Such stocks will not be sold to the local trade for trading purposes. It must be noted that in the absence of such clear guarantee by government before they start acquiring such stocks, a Pandora's Box of corruption will open up that we had managed to shut down earlier after a long and painstaking fight. He said Pakistan needs to gear up to maximize rice exports and facilitate the exporters but the biggest chunk of effort can come from thousand or hundreds of thousands of SME exporters. He suggested abolishment of QRC on all rice exports (which has outlived its utility and is nothing but a costly irritant) as well as eradication of MEP on all rice exports (This is against free trade and demands untruths from exporters). It is important to mention here that Export Refinance Scheme was introduced with an aim to boost exports of non-traditional items in Pakistan. The scheme is bifurcated in two parts i.e. Part I & Part II. Under Part-I, the finance is given on pre as well as post shipment basis for export of eligible commodities. This facility is provided on a case-to-case basis. Under Part-II, an exporter may avail the export finance limit, based on his last year's export performance in respect of eligible commodities.