More Car Makers Are Making Entry In Pakistani Auto Industry

The car industry has made a prominent development in the last two years due to incentives provided by the government under the Automotive Development Policy ADP 2016-21, with the arrival of many new car companies from within Asia and Europe.
According to an official document shows that nine new companies have already started production of cars in Pakistan, and it is expected that three to four new companies will start production of vehicles in the current financial year.

However, the ADP 2016-21 has expired and the government aims to give carmakers a new road map through the Automotive Industry Development and Export Policy AIDEP 2022-26.

The new policy has the following objectives:

 Affordability of small cars for Pakistani consumers
 Better quality and safety features in cars
 More competition among car makers
 Domestication and export of auto parts
 Creating a legal framework for the auto sector
 Increase in annual vehicle production
 Promotion of new technology
 Eliminate policy flaws

AIDEP 2022-26 is expected to be launched in the current financial year to meet the incentives offered during the budget 2021-22, after which new clauses will be added which will be in favor of these targets.

Low CBU sales in the future

The government of Pakistan is working hard to incorporate some changes to fully localize car production in Pakistan. Instead of imposing a complete ban on imports of fully built-up CBU vehicles, it has proposed raising the regulatory duty RD on imports to 50 per cent. This recommendation is in the interest of curbing large import bills and current account deficits.

According to a senior official of the Ministry of Industries and Production told media that the proposals would be submitted to the Tariff Policy Board TPB for approval, after which the draft policy would be submitted to the Prime Minister for final review and decision.

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