LAHORE, Dec 20: Federal Industries Minister Jehangir Tareen has given two months for the elimination of the issue of premium on new cars.

"The government has already taken and would take further measures to resolve the issue to protect the consumers if it was not settled in the stipulated time," said the minister while answering reporters at a ceremony organized by Honda Atlas Cars on Monday.

Honda Atlas Cars (Pakistan) Ltd President/CEO Mamoru Suwama and its Chairman Yusaf H. Shirazi also spoke on the occasion in which the company announced to double its production from 1,250 units per month to 2,500, raising the annual production to 30,000 cars.

Mr Tareen said the government had taken steps to discourage charging of premium on cars. "We have made NTN mandatory for booking a car. Only one car per NTN holder is allowed. Moreover, the assemblers have been encouraged to increase the production of cars, allowed import of cars and reduced tax on second-hand imported cars."

In reply to a question, he said the Pakistan Industrial Development Corporation (PIDC) Board had approved Rs150 million each for its subsidiary company - the Technology Upgradation and Skill Development Company. The company has already been registered and is expected to become operational in the near future.

Earlier, speaking at the seminar, Mr Tareen said that Honda's increased production would help reduce the waiting time to two months. He said the government wanted the car production to increase because it would have positive impact on the economy by enhancing vending activities and generating new jobs.

He was of the view that an increase in car production would lead to economies of scale that would ultimately bring down prices and create greater demand. Mr Tareen said the government would establish industrial parks and help clustering of vendors at one place to enhance efficiency.

He said economic reforms had led to the revival of economy in the last five years that had allowed the country greater fiscal space for pro-people projects and create jobs. He said the government wished to make Pakistan a hub of manufacturing for the local as well as international market.

The minister said the government would not change the policies related to the engineering sector without first taking businessmen and other stakeholders into confidence. He said no dramatic change was going to take place in the country either in the political or economic areas.

He said the government would take some 30-40 vendors to Hanover, Germany, for participating in the largest engineering fair this year as compared to four or five companies in the previous years. He said Rs35 million had been approved for the purpose.