When the automobile sector is rendered toothless, imagine what will happen to the rest of the manufacturing industries
KARACHI: Apropos of the letter titled, “Import of used cars” by Dr Adnan Khan, published on August 18, I wish to emphasise that whichever way you look at it, the import of used cars is highly detrimental to the national economy. If the indigenous automobile industry was allowed to flourish as per its natural course, very soon, a time will come when automobile prices will begin to come down due to better economies of scale. This has happened in India and other markets and the complaint of locally produced new cars costing more than imported used cars is no longer valid there.
It must be understood that the automobile industry in any country forms the core of its engineering capabilities and its economy. The automobile industry was flourishing in Pakistan until the late 2000s, after which the government’s automobile policy changed and instead of giving more incentives to the local industry, the import of used cars was allowed in a more extensive manner. This was the time when the Pakistani economy was also ‘down in the dumps’ and, as a result, sales of locally produced cars went into a slump. While the local automobile industry is picking up again, it has not been able to generate the kind of boost to the economy that it is capable of producing, in terms of creating more jobs and greater savings of foreign exchange. The national automobile sector must be encouraged, given more incentives and driven forward. Otherwise, we will very soon become a net automobile importing nation and our own industry will be stymied. When the automobile sector is rendered toothless, imagine what will happen to the rest of the manufacturing industries.
Shahmeer Malik
Published in The Express Tribune, August 22nd, 2015.
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