ISLAMABAD, May 12: Federal Finance Minister Shaukat Aziz has urged auto manufacturers to increase production of vehicles to meet the rising demand in the country.

The minister said that the only challenge to the industry is to increase its production shortly and avoid the unhealthy practice of premium “which not only brings bad name to an individual manufacturer but also malign the image of the whole industry.”

He said that the industry should make more investment in this sector and also start double shifts for producing competitive vehicles.

The minister was speaking at the inauguration of auto-XPO exhibition here at a local hotel organized by Pakistan Automotive Manufacturer’s Association (PAMA) in collaboration with Pakistan Association of Automotive Parts and Accessories Manufacturers (PAPAAM).

“The industry has the potential to export our vehicles to some of those countries who do not have local facilities as well developed as ours”, he said.

Mr Aziz said that the engineering sector could also play a better role by producing particularly more competitive auto-parts for its subsequent export to earn foreign exchange for the country.

He said that the current export of the industry valuing at $3.5 million this year showed growth of the industry which could be increased in the next two to four years.

“As a nation we need to understand that we have to compete on the basis of the competitive advantage. We would like to make use of competitive labour and the entrepreneurship of our people supported with the supply of raw material at cheap rates to promote our local industry”, he said

He said that “abandoning our local industry under the pressure of WTO regulations is out of question.”

“We are committed to protect our local industry from unfair competition, smuggling and mis-declaration without compromising our international commitment”,he remarked.

Chairman, Pakistan Automotive Manufacturers Association, Kanwar Idress said that fortunately the last three years have witnessed phenomenal growth in the industry in terms of technological advancements and production/sales volumes with local contents rising as high as 90 per cent.

The industry is ready to face this challenge positively and the Auto Expo 2003 is being held just to demonstrate this resolve, he said.

He said the industry is already employing 120,000 people, contributing more than Rs30 billion including substantial foreign investment. The local contents have reached as high as 90 per cent in tractors, motor cycles and 70 per cent in motor cars, he said.