Deliver cars in two months or pay markup: Govt asks auto makers
By Bureau Report
PESHAWAR, Feb 3: The automobile manufacturing sector has been directed to ensure delivery of locally assembled cars in two months after the payment of advance at the time of placing orders otherwise they would have to pay mark-up at the current banking rate.
This was stated by Federal Minister for Industries Liaquat Jatoi during a meeting with members of the Sarhad Chamber of Commerce and Industry (SCCI) here on Monday.
Furthermore, the local car manufacturers, he added, had also been asked to introduce double shift in their units to increase their production.
The move would increase the number of cars assembled by the Indus Motors alone, in a month by 3500, over and above what they are marketing at present, said Jatoi.
The measures had been necessitated to strengthen the over all industrial base in the country and hoped that the car manufacturers would also bring down the prices of their cars.
Similarly, he added, the ministry had decided to curtail the role of middleman to control prices and ensure timely delivery of cars.
In this respect, the chief ministers of all the provinces would shortly be contacted to take appropriate measures to ensure that every new registered car should not be transferred for one year after its delivery to its first owner.
“This would certainly curtail the role of middleman who is presently exploiting the situation to his benefit,” said Jatoi.
Explaining further, new cars - as per the scheme of thing he would shortly share with the provinces - should only be registered in the name of the person who was released the car and the same should not be transferable for one year to any other person.
He hoped the measures would help increase the number of cars assembled in a month and considerable improvement had already been recorded in that regard, he added.
According to him, the automobile sector had contributed 40 per cent to the over 17 per cent contribution the manufacturing sector had made to the GDP, so far, during the current financial year.
Regarding the car manufacturing units’ deletion programme, he claimed that Indus Motors had recorded significant improvement on this count.
Around 48 per cent parts of the Toyota make, he added, were being manufactured locally - a claim rejected by the former President FPCCI Ilyas Ahmed Bilour who was also present on the occasion and disagreed with Mr. Jatoi’s claim.
The minister said that though considerable ground had been made in that respect, the government wanted the local car manufacturers to produce 70 to 75 per cent of the parts locally “because we have to bring down our imports.”
Responding to Mr Jatoi’s claims viz-a-viz automobile industry, former FPCCI president Ilyas Bilour and Mohsin Aziz, former chairman Aptma, said that whereas a single car manufacturing unit had been enjoying tax exemptions of Rs3bn to Rs4bn per annum the NWFP industrialists’ demands for incentives and facilities had never been paid any attention. “We don’t demand incentive, we demand cost adjustment as the incentives being enjoyed by a single car manufacturing unit would cater for the needs of the NWFP’s entire industrial sector,” said Mohsin Aziz, who also served
as provincial minister for industry in the last military-backed civilian government in the NWFP.
Replying to their demands and issues raised by some other members of the SCCI, the industries minister admitted that without giving incentives industrialization could not be encouraged, hence, incentives would be extended to encourage investment in the manufacturing sector.
In this respect, he also assured the representatives of the Gadoon Amanzai Industrial Estate (GIE) who were present on the occasion that their demands viz-a-viz incentives would be looked into.
