KARACHI, March 10: The government does not appear to be inclined to allow import of reconditioned cars but definitely wants to effectively curb the premium cost and delayed deliveries of booked new cars to the customers.

A delegation of 20 automobile tycoons representing the local car making industry that included six Japanese investors met Finance Minister Shaukat Aziz on Tuesday to assure him of increasing the production and indegenization process in the industry.

The Pakistan Automobile Manufacturers Association (PAMA) team was originally scheduled to meet the minister on Wednesday but held meeting on Tuesday after leaders of the Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam) briefed Shaukat Aziz of their views on implications of second hand cars import in Pakistan.

The car assemblers claimed to have brought down the premium cost on cars from Rs100,000-Rs150,000 that was charged up to June last year to Rs40,000-Rs70,000.

They also claimed that delivery period of booked cars has come down from one year and above till June 2003 to four to six months. "In some cases booked cars are being delivered in three weeks," a car assembler said.

Car assemblers assured minister of 105,000 car units assembly in the current fiscal year, which they pledged to increase it to 140,000 in 2004-05, 157,000 in 2005-06, 172,00 in 2006-07 and 188,000 in 2007-08.

They also indicated of at least Rs8 billion investment plans in the BMR of the existing facilities capacity plus the additional investment already made by two new automobile companies that are coming in line during next fiscal year after July 04.

The car makers made a strong plea with the minister to maintain the existing tariff structure on automobile industry and according to a local car assembler the Japanese investors made it clear that any deviation from present policy would give a severe setback to their industry.

The Japanese investors are reported to have complained that their investment suffered a lot because of yellow cab and green tractors scheme in the past and the industry was in no position to bear another jolt.

Car assemblers blame the stock brokers for disturbing the automobile market with their massive speculative booking and mounting premium cost. According to car assemblers, the government is considering the recommendations of a task force led by the federal industries and production secretary Javed Ashraf. The task force has suggested:

i) Only one booking per one national identity card.

ii) National Identity Cards of all individuals who booked cars be provided to Central Board of Revenue every month to update CBR records.

iii) Prior to the delivery, it will be mandatory to have the registration of car done in the name of the person who has originally booked the car.

iv) Dealers' base be enlarged.

v) If the above measures do not provide the desired results, the task force recommended that the provincial governments may be taken on board to restrict transfer of ownership of new car for a period of six months from the date of its purchase.

Provincial governments are reported to have resisted the implementation of this recommendation on the plea that it would affect their revenue generation capacity and that there is a possibility of any citizen going to higher court on the ground that any restriction to sell or gift away any movable or immovable property violates the fundamental human right.

One of the options now being considered is to enforce a heavy fees on registering a transfer of new car to discourage speculative booking. The car assemblers are expected to give a set of their recommendations to the government in next one week.