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Import of Used Cars: MoI&P fails to muster support from Stakeholders
MUSHTAQ GHUMMAN
ISLAMABAD: Ministry of Industries and Production (MoI&P) has reportedly failed to muster the requisite support from stakeholders to allow commercial import of used cars, due to concerted resistance by the auto industry, sources close to Secretary Industries told Business Recorder.

The sources said, Acting Chief Executive Officer (CEO) Iqbal Ahmad who is also Additional Secretary Industries discussed the most controversial plan with the Ministries of Finance, Commerce and Federal Board of Revenue (FBR). “What I know, no other stakeholder except the MoI&P is ready to support commercial import of used cars,” the sources added. Pakistan’s auto industry is using its influence to block the government’s plan prepared on the instructions of Prime Minister, Syed Yousuf Raza Gilani who is annoyed at the cars makers’ decision to raise prices of their models without justification.

The sources revealed that the Prime Minister has clearly directed the Industries Ministry to press the auto industry to reduce prices and if they refuse, allow commercial import of used cars. Auto industry is of the view that any such decision will compel it to shut down business; and auto industries key players are approaching all the top executives to block the government plan.

As part of its strategy, car manufacturers recently met the Minister for Industries and Production, Mir Hazar Khan Bijarani in Karachi to muster support but he refused to extend any support, saying it is the ECC, which has to take the final decision.

Minister of State for Industries and Production, Ayat Ullah Durrani was also in Karachi on Friday last and reportedly he was also approached by the auto industry.

The sources said that when the issue of cars came under discussion in the previous ECC meeting some of the members proposed to allow import of used cars to compel local manufacturers to reduce the cost of production by utilising their full capacity. Besides they argued that the car industry should be persuaded to localise otherwise incentives may be withdrawn.

ECC also enquired about the functions of Engineering Development Board (EDB) and its contribution in the field of automobile sector. After detailed discussion the ECC deferred decision on the proposals regarding reduction in tariff on import of new cars as well as commercial import of 3 year-old used cars.

MoIP has been directed to bring a summary to the next ECC meeting with full information about profit/ loss of different units in the automobile sector. The summary will also contain proposals for improving the personal baggage, transfer of residence and gift schemes for the purposes of import of used cars, in consultation with the Revenue Division, Ministry of Commerce, Board of Investment and other stake holders. EDB will give a presentation to ECC in the next meeting about its functioning and contribution towards automobile industry.

Source: Business Recorder