Auto parts export to US on the rise

It can be increased further by creating linkages between Pakistani, US companies for JVs


Shahram Haq December 23, 2022

LAHORE:

Pakistan’s exports of auto parts to the United States (US) are on the rise, which can be further increased by creating linkages between Pakistani and US companies for joint ventures and technology collaboration.

According to stakeholders, the value of parts and accessories for tractors and motor vehicles for transport (of 10 or more persons) exported to the US increased to Rs5,374 million in 2021 against Rs3,528 million in 2019.

Similarly, the export value of parts and accessories for motorcycles and bicycles and for carriages for disabled persons was Rs273 million in 2019, which increased to Rs323 million in 2020 and Rs416 million in 2021.

The export of tractors (other than tractors of heading 8709) to the US was zero in 2019 but rose to Rs65 million in 2020 and Rs145 million in 2021.

The export value of trailers and semi-trailers and other vehicles was Rs2 million in 2019, which increased to Rs7 million in 2020 and to Rs52 million in 2021.

Recently, Farooq Mughal, who has been elected to the Georgia House of Representatives, visited a local auto parts manufacturing company.

He was part of a delegation of America-Pakistan Business Development Forum (AMPAK-BDF) that held a session with Mehran Commercial Enterprises (MCE) on how to increase trade in engineering goods between the US and Pakistan.

MCE produces different auto parts and exports to Chile, the Czech Republic and the United Kingdom.

The delegation discussed integration of Pakistan’s engineering industry with industries in the US for sub-contracting auto parts. The industries under focus were auto, aerospace, electric vehicles, railway, energy and electronics.

“We can achieve higher exports by creating linkages with associations and original equipment manufacturers (OEMs) as our aim is to develop cooperation with small and medium enterprises (SMEs) in the US,” said MCE Director Mashood Ali Khan while talking to The Express Tribune.

Khan added that plausible trade could be achieved in the SME sector in the US and to develop linkages, “we should develop a portal of SMEs in the US and Pakistan for interaction”.

He informed the delegation that auto parts makers in Pakistan were close to 2,000 in numerical strength and had in-house technology for sheet metal, forgings, castings, machining, rubber, plastics, electronics, jigs, fixtures and interiors.

“A number of companies export auto parts to different countries including the UK, Bahrain, Denmark, the Philippines and Afghanistan,” Khan noted, adding that due to an efficient auto parts industry, the country achieved 60% localisation in cars, 90% in tractors, 30% in trucks and buses and 95% in motorcycles.

Meanwhile, AMPAK-BDF President Imtiaz Sheikh told The Express Tribune that they served as a source of information and an easily accessible platform for both the American and Pakistani communities having business and investment interests in Pakistan and the US.

“Our forum incorporates professional and expert individuals, who have active involvement with American and Pakistani government representatives, private sector companies and strategic think tanks,” explained Sheikh.

Published in The Express Tribune, December 23rd, 2022.

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