Govt may allow import of Indian cars
Amanullah Khan
Karachi—The government is considering to go for the import of Indian cars if the widening gap between supply and demand continued to persist allowing the middle man minting money in the local market.
The finance ministry, accepting the longstanding demand of local car dealers and importers in the budget 2005-06 allowed the import of old and used cars at the depreciation facility of 2 percent per month. However, the ministry maintained the condition of a luggage and gift scheme and the car dealers or the traders cannot import used and old vehicles directly.
Informed sources said those relevant authorities taking a close watch of the situation and might take decisions to ease the demand and supply situation by allowing import of cars even from India.
The gap between demand and supply was widening with each passing day. Last year the local automobile industry produced approximately one hundred thousand cars of various brands but those were not enough to meet the existing demand. A number of financing schemes readily available in the market backed up with easy and comfortable pay back installments, which is also fueling the demand.
It is however feared that the import of new and used cars under different schemes have its implications on the growth of vendor industry besides adversely affecting deletion strategy aiming at promoting the engineering sector within the country.
In 1999, Pakistan’s “deletion” programme (mandating the use of domestic inputs) encompassed 106 items. As of December 2004, 16 items in the auto and motorcycle industries remained to be deleted. For these 16 items, Pakistan had petitioned for a three years extension on its original December 31, 2003, deadline to eliminate all deletions. Being a developing country, Pakistan was required phasing out and withdrawing the trade related investment measures, inconsistent with the agreement on TRIMS, by the year 2000.
http://www.pakobserver.net/200512/04...pstories15.asp