LAHORE: The local automotive industry has expressed concerns over the ‘government’s failure’ to control misuse of the import schemes, which they claim is affecting the local industry.

“In 2020, the number of vehicles manufactured locally in Pakistan surged from 275,000 to 325,000 units. It later started decreasing due to Covid and post-Covid situation and imposition of high taxation, financing issues, import of completely knocked down (CKD) units and misuse of the baggage, gift and transfer of residence schemes. Now, the number has considerably dropped to 150,000 to 175000 units,” said Nabeel Hashmi, former chairman of the Pakistan Association of Automotive Parts & Accessories Manufacturers (PAPAAM).

“The problem is that the government is not bothered about the local industry, which is 20pc of the country’s large-scale manufacturing business. I don’t know why it is doing this despite knowing well about the misuse of the schemes under which thousands of used, damaged and accidental cars are being brought to Pakistan using passports of overseas Pakistanis,” he told Dawn while lashing out at the government on Tuesday.

According to a PAPAAM’s report, among the CKD and used car importing countries, Pakistan exists on top of the list with 24pc, whereas India has zero share, Vietnam 0.3pc and Thailand 1.2pc.

The report said, “The government, which brought in 25 international automotive players, $5 billion as FDI that generated 2.5 million jobs in 1,200 factories and Rs500bn in tax collection for the govt exchequer and received $600 million in foreign remittance, decided to allow import of up to five years old vehicles.”

The report claims that from December 2024 to October 2025, as many as 45,758 cars were imported from Japan, followed by 130 from Thailand, 55 from USA, 49 from Jamaica, 47 from Germany, 22 from Australia, 20 from China and five from UAE.

“The import of used cars is damaging the domestic industry which creates jobs. So PAPAAM’s position is very clear that the government must control misuse of the baggage, gift and transfer of residence schemes by regulating them properly,” said PAPAAM former chairman Amir Allahwala.

Published in Dawn, December 3rd, 2025