LAHORE: Representatives of the auto industry in Pakistan have welcomed new investment in all sectors, but urged that new investments should not endanger the existing industry and a level playing field.
“The auto industry already has enough competitors compared to demand, but for the sake of growth and consumers’ benefit, new players will be welcome on existing terms and conditions,” said Abdul Waheed Khan, director general Pakistan Automotive Manufacturers’ Association (PAMA).
Khan appealed to the Federal Minister of Finance to not allow new entrants that might endanger existing investment.
“We will oppose new investment if it disrupts the equation by obtaining unfair grants of relief in duty and taxes,” he said.
PAMA’s note to the Minister says that progressive growth in the motorcycle sector has so far been maintained by a policy which allows incentives for localisations, but at the same time permits introduction of new technologies by allowing import of components against a different tariff. However, the proposed policy shift, to favour a single entrant which will import 100% parts at 5% duty, means that the new entrant will need to invest next to nothing to gain access to this market. Motorcycle manufacturing in the future will simply be an assembly operation, it says.
Published in The Express Tribune, April 28th, 2012.
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