KARACHI, Dec 12: The government will not allow import of used cars in future, joint secretary, Ministry of Industries and Production, Yasin Tahir, said.

In a brief chat with Dawn at the Site Association of Industry on Thursday, he said the government would protect the local industry and would not allow the import of second-hand cars at any cost.

Adviser to prime minister on finance and economic affairs Shaukat Aziz on Wednesday hinted at reviewing the decision on import of reconditioned cars. He said the Ministry of Industries and Production was examining the case and was expected to take some decision on this issue.

To a query as to why the local assemblers had not reduced the prices despite the dollar’s losing strength against the rupee, the joint secretary defended that local assemblers had not increased the prices in the last two years.

It was not possible to cut prices of cars on the basis of the dollar strength against the rupee as the assemblers had to suffer more due to the rising cost of utility bills like KESC. Even makers of Suzuki had reduced the prices by Rs30,000-40,000 few months back.

He was satisfied with the current pace of production, saying the local industry is meeting the demand spurt by raising the production.

The market has seen a boom in car sales in the last few months owing to attractive car leasing schemes and around 4,000 extra number of cars had been booked, he said. To meet the demand, the manufacturers had to manage extra inventory of kits and the vendors had geared efforts to meet the rising demand.

He said if dealers had booked a sizable number of cars then it had nothing to do with the government.

Actually there was a problem of 3,000-4,000 rich people in the country, who were in a bit hurry to get the car by paying extra amount to the dealers instead of getting the car through a proper channel. This situation had caused a stir in the market and the demand had outstripped the supplies.

On Tuesday, a businessmen at the KCCI function had pointed out to Adviser on Finance Shaukat Aziz that the assemblers had not brought down the prices despite falling dollar against the rupee. Assemblers were demanding 100 per cent cash payment but failed to deliver the cars even in six months period.

Mr Shaukat, however, said there was no apparent justification of holding back cars for six months even after getting full cash payment.