PAAPAM rejects objections on used car import policy

Calls criticism misleading, against national industrial interests; says new framework restores fairness, protection

LAHORE:

The Pakistan Association of Automotive Parts & Accessories Manufacturers (PAAPAM) has strongly backed the government's revised used car import policy under the "Motor Vehicles Safety, Quality and Environmental Standards for Imported Vehicles" notification issued on September 30, 2025.

In a statement released on Monday, PAAPAM rejected objections raised by the All-Pakistan Motor Dealers Association (APMDA), calling them misleading and against national industrial interests.

The association said used car importers had for years exploited regulatory gaps without contributing to value addition or jobs. They benefited from a fixed duty regime on 1300cc vehicles, further reduced by 1% per month based on age. This distortion, said PAAPAM, penalised local manufacturers complying with safety, tax, and employment standards.

PAAPAM Chairman Usman Aslam Malik condemned these favours, saying they enabled under-taxed imports that hurt compliant producers. He noted over Rs60 billion in lost vendor revenue and more than 40,000 displaced jobs in FY2024-25. Malik said APMDA's stance ignored the broader industrial impact, promoted the undocumented economy, and facilitated money laundering through car imports.

The revised policy introduces structured commercial imports with a 40% additional duty in year one, gradually reduced until FY2030, and requires safety and environmental certification through the Engineering Development Board (EDB).

Senior Vice Chairman PAAPAM Sheryar Qadir welcomed the new framework, saying it restores fairness and gives the local industry time to adapt.

PAAPAM also opposed APMDA's demands to remove EDB oversight, reduce duties, and allow unregulated licensing, saying these would undermine safety, discourage investment, and repeat past policy abuses.

With over 65% local value addition and UN-standard safety regulations now in place, Pakistan's auto industry is ready to meet consumer demand competitively.

"Pakistan's industrial future depends on protecting jobs, investments, and innovation that come from domestic manufacturing—not rewarding those who contribute nothing to our economy," Malik said.

The statement adds that PAAPAM reaffirms its commitment to work with the government and stakeholders to build a transparent, competitive, and resilient automotive sector.