KARACHI, May 18: Commerce Minister Abdul Razak Dawood has declared emphatically of the government’s intention of not allowing import of used cars despite the fact that the market is still facing shortage of cars and dealers continue to charge premium.

He made this statement in the 53rd meeting of the Advisory Council of Ministry of Commerce held in Islamabad last week, which was attended by a large number of businessmen from various associations.

The commerce minister was actually responding to a question raised by Pakistan Bedwear Exporters Association (PBEA) chairman Shabbir Ahmed and other businessmen to allow import of used car.

The minister did not give any further details as to why the government was not in favour of allowing the import of used cars, said the PBEA chief.

Shabbir said he questioned Mr Dawood if other used items like textile machineries and machines for other industries are being imported then why not used cars. The PBEA chief said the auto industry had been enjoying tremendous protection since its inception, while the government had maintained the import duty on used car at 250-350 per cent when the dollar was available at Rs10 some 15 years back. The current rate of dollar is Rs60, but the import duty is still unchanged.

Pakistan Petroleum Dealers Association chairman Abdul Sami Khan said that commitments and promises made by the car manufacturers, regarding increase in production to discourage black marketing, had not been fulfilled.

He told a press conference on Saturday that customers were still facing hardships and difficulties in getting new cars at fixed rates.

All Pakistan Motor Dealers Association on May 15 again informed President Pervez Musharraf that premium is still being charged on new cars.

The association gave the example of new Toyota car, whose booking started on March 5, 2002. So far the company had booked 4,000 cars against the collection of 100 per cent cost. Indus Motors had delivered around 600 cars through their authorized dealers after the collection of a premium ranging between Rs200,000 and Rs250,000.

In other words, the association said, the company was not only earning a huge premium on each car but also earning the mark-up of Rs4bn that had been collected against the booking of 4,000 cars.