Islamabad: The automotive industry has urged the government to determine the sector’s future direction, warning that local manufacturing and the import of used cars cannot move together.
In a letter to the ministries of finance, commerce, and industries, the Pakistan Association of Auto Parts & Accessories Manufacturers (Paapam) said that the industries and manufacturing sectors were the job providers, but government policies were discouraging them.
“The government has to consider the balance between the local industry and the imported used cars and make a choice for a long-term policy,” Abdul Rehman Aizaz, the Paapam chairman, told Dawn.
He added that used cars promote the traders in Pakistan but actually benefit the economies of the countries where they are manufactured.
“And the imported vehicles do not meet the basic requirement of providing cheap cars demanded by local manufacturers,” Paapam said.
It added that despite heavy taxation and other high costs of doing business in the country, the local industry continues to operate and invites investments.
Paapam’s letter to the government said that despite all the challenges, the industry has localised over 60pc of manufacturing by producing internationally tested and high-quality local parts.
Paapam has said that Pakistan has 13 automobile manufacturers/assemblers. Yet, the authorities have permitted the import of used cars, even though the associated vendor network and the industry provide almost 5m jobs.
Paapam has added that the inconsistent government policies regarding used cars have led to a lack of local product development.
“A new model design, manufacturing and launch takes around four years of development, R&D, testing, quality control from international facilities and a huge amount of investment; there is no support from the industry and vendors due to a lack of confidence because of policies,” the letter added.
Published in Dawn, May 22nd, 2024
