ISLAMABAD: Importers welcome the easing of regulations on commercial imports of second-hand cars, but stress that Pakistan needs a competitive auto-sector economy.
The Engineering Development Board (EDB) notification dated Sept 30 has relaxed the criteria for importing used vehicles.
The changes included removing a clause that required a minimum capital requirement for a company importing used cars, and now any tax-registered individual or firm, even if not registered with the Securities and Exchange Commission of Pakistan (SECP), can commercially import vehicles.
All Pakistan Car Dealers and Importers Association and Member FPCCI Executive Committee Chairman Mian Shoaib Ahmed said that the move will encourage business and attract investment in this category.
Dealers cheer EDB move, assemblers decry commercial import relaxation
The commercial imports will continue to rise in the coming months, he said, adding that the pre-shipment inspection mechanism has been streamlined, easing the import of vehicles under the gift scheme.
“There was a demand for used cars in Pakistan as the new Chinese entrants have yet to make their mark in Pakistani markets as the Japanese car assemblers in the country were not yet ready for the competitive environment,” Mr Ahmed remarked.
The EDB has also notified that pre- and post-shipment inspections will be conducted through the Pakistan Standards and Quality Control Authority (PSQCA) instead of the EDB.
Meanwhile, PSQCA Director-General Dr Sayeda Zia Batool told Dawn that inspections were not carried out directly by the authority but by approved and registered inspection agencies.
Currently, only two local inspection agents are registered with the PSQCA, and they represent firms accredited by the Japanese Foreign Principals Inspection Agencies.
Meanwhile, fearing a surge in used-car imports, local manufacturers have criticised the government’s decision.
In September, a total of 2,276 vehicles were imported under the gift scheme, as the strict restrictions under the baggage scheme continue.
Figures from the Ministry of Commerce show that in May, only 48 used cars were imported, mainly through the baggage scheme.
However, the situation began to change in June, when a total of 843 vehicles were imported, including 806 under the gift scheme, following a one-off waiver of pre-shipment inspection.
The figure hit 1,938 in July, with 1,876 cars under the gift scheme.
August saw 1,445 vehicle imports, and in September 2,276 vehicles were imported, of which 2,238 were under the gift scheme.
Meanwhile, a senior executive in the automotive industry said that the reduction in duties on completely built-up units by 20-25pc in 2026-27 has reduced import costs.
“We have reports that the one-year restriction on the transfer of ownership is not being implemented in some cities, which is causing this business to flourish again, but at the cost of the domestic auto industry, which consists of 13 assemblers and over 300 auto parts manufacturers,” the executive added.
While the auto part vendors have also expressed their concerns, claiming that after a gap of 3 years, auto production has started to increase, which was also contributing to the Large-Scale Manufacturing growth.
“Locally produced cars contain up to 60pc local parts by value, amounting to an average of Rs1.5m per vehicle, and import of 2,276 used vehicles meant loss of Rs3.4bn of local parts production which creates jobs and operates in the documented economy,” the Pakistan Association of Automotive Parts & Accessories Manufacturers (PAAPAM) Chairman Abdul Rehman Aizaz said.
He termed it unfair that, on one hand, the proposed auto policy is slashing import duties on new cars, while on the other hand, used car imports are being encouraged. “Ultimately, Pakistan is moving towards a market dominated by imported new and used vehicles with no industrial activity,” he said, adding that the used car business is completely unregulated.
Published in Dawn, October 4th, 2026
