KARACHI, April 26: The import of automobiles exceeded $1 billion mark during the first nine months (July-March) and market sources predicted that it would be in close vicinity of $1.5 billion at the end of the current fiscal year.

Auto import now constitutes almost 20 per cent of the machinery import group which claimed $5.33 billion during July-March 2005-06. Textile machinery import maintained a rising tempo for last few years has now started showing a declining trend. As summer sets in and brings with it the long periods of power breakdown, the demand for electric power generators is on rise. Rise in import of electric power generators is one indicator of this mounting demand and it has so far claimed about $400 million.

“Bulk of auto import is CKD (Completely Knock Down) and CBU (completely built units) comprise a small part,” a very highly-placed source in federal commerce ministry tried to explain the journalists sometimes ago. But there is no break down of the auto import.

Market sources say that the number of reconditioned cars that are coming as accompanied baggage has increased considerably in last more than one year which has caused considerable discomfort to less than half a dozen auto assemblers who are sending an SOS every day to the government as the date of budget draws closer.

Driven by generous bank loans, the number of cars coming on roads is increasing every day and roughly half a million have been added in last two years aggravating pollution, increasing gas and fuel consumption, making roads more dense and traffic unmanageable. One of the immediate impacts of increase in automobile population is increase in demand of wages by the professional drivers.

Coupled with rising trend in the international prices of oil and increase in the number of automobiles and private electric generators, the oil import bill in the last nine months rose by more than 64 per cent to $4.62 billion as against $2.80 billion the same period last year.

As international oil prices touch $75 a barrel and indications are there that there could be a further rise, the total oil import bill could be in close vicinity of $6 billion.

Worsening conditions of roads in the cities and mounting gasoline prices can force a large number of middle income group people to dump their cars in the garages. Banks are not reporting recovery position of the auto loans advanced so far but may start sharing this information by next year.

An almost 36 per cent increase in food bill import is another worrisome factor for the economic managers of the country. Food import bill in last nine months amounted to $1.34 billion as against $990 million last year. Sugar import claimed more than $275 million, showing a phenomenal growth over last year. Edible oil, milk, pulses, wheat, spices and tea are now the permanent items on Pakistan’s import list.

About 62 per cent growth in iron and steel group import costing $1.40 billion indicate growing demand for the housing and construction industry and in capital goods.