Price hike for smart cards expected

In Punjab, an enormous increase in the price of smart registration cards for cars and motorbikes is expected. The Excise and Taxation Department announced new tenders for after the 5-year contract period, with the deadline for submissions being Friday.

Due to the fact that companies have proposed to produce smart cards for Rs1,400 in Sindh tenders, it is anticipated that the Excise Department of Punjab will also receive proposals between Rs1,350 and 1,450 given the remarkable increase in the value of the dollar. Even though the Secretary and DG of Excise Punjab are putting in effort to produce the new contract at a cost of Rs700 per card, private enterprises have said it is impossible.

The department had a contract with a private company five years earlier, paying Rs434 for each card. At that time, the National Database and Registration Authority (NADRA) also took part in the tender and seven firms submitted offers. However, this time NADRA did not participate in the tender and only three firms did.

As per the details, a private company accepted the contract for five years at an offer of Rs434 per card in 2018. This smart card was sold to the general public for Rs530 by the Excise Department at that time, with an additional Rs96 was charged for various departmental expenses. After the five-year contract expired, the department issued a fresh tenders for offers, with the deadline for submission set at August 31st.

Sources claim that the dollar was worth Rs104 when the arrangement was made five years ago, but the rates have now skyrocketed to Rs325 on the open market and Rs306 on the interbank market. The Sindh government received an offer of Rs1,400 per card from the Sindh Excise Department, which issued tenders for the production of smart cards several weeks ago.

The smart card issued by the Punjab Excise Department has over ten security measures including "NFC" (near field communication) technology, a monogram, a blue pattern that changes colour with temperature and unique lamination. However, the raw materials to produce these cards are imported

Every year, the Punjab Excise Department needs around 3.1 million smart cards, of which 1.5 million are required for new vehicle registration and over 1 million for ownership changes.

The sources claim that DG Excise Mohammad Ali and Secretary Excise Masood Mukhtar are working to get a new contract for the production of smart cards between Rs700 and 800 per card. Despite the fact that Excise Punjab produces several times more annually cards than Excise Sindh, private companies believe that a significant price rise is now unavoidable as a result of the rising dollar.

Published in The Express Tribune, September 2^nd, 2023.