Pakistan has finally announced the new Auto Policy after the continuous gap of almost two and half years. This has been approved by the Economic Coordination Committee of the cabinet. The policy named Automobile Development Policy 2016-21 has been approved by the Ministry of Finance.
The major developments in the new automobile policy are in the shape of granting special discounts to the overseas automakers to set up their manufacturing plants in Pakistan. According to the new policy, the automotive machinery parts will be imported without paying any tax amount. For the first time, tight conditions are going to be made for the existing companies in Pakistan who have been accused of selling the cheap models of vehicle in the country at higher prices by making an alliance with each other for that purpose.
Commenting over the Automobile Development Policy 2016-21, Defense Minister Khawaja Muhammad Asif said, “The purpose of this policy is to meet buyers’ needs for new market and automobiles.” The new auto policy has been designed under the supervision of Defense Minister and according to him a general Pakistani buyer despite consuming the almost Rs. 26 lakh for an 1800cc car never gets the real worth of his money.
These local companies are charging international prices and provides low-quality safety services as compared to those approved at the international levels.
According to Chairman of Investment Board Miftah Ismail, though this new policy government is expecting the arrival of at least two international automakers in the country. By acting upon this policy, the prices of cars can be reduced up to much extent, he said.
The major points in the Auto Development policy are no more duty on the import of car plants, duty rate at 10% on only those parts that are not being manufactured in Pakistan and 25% duty in rest of the parts. These incentives are for the next five years for only those auto companies who joined the Pakistani market in the next five years.
Last year German automaker Volkswagen decided to step into Pakistan but now the decision by the company is still pending in this regard. After the announcement of new Automobile Development Policy 2016-21, there are chances that new international automakers will consider the Pakistani automobile industry.