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Pakistan auto market has potential of 30pc growth


3/7/2017

Renault, Hyundai, Kia to set up plants

Amanullah Khan

Karachi

The expanding auto market having a 30 percent growth potential in Pakistan has attracted Renault, Hyundai and Kia motors to set up their assembly plants in Pakistan. According to Prime Minister’s Special Assistant on Investment and Chairman, Board of Investment, Dr. Miftah Ismail, who was speaking as the Chief Guest at the closing ceremony of Pakistan Auto Show (PAPS 2017), said no FTA will be signed at the cost of local industry, economy or employment of people associated with it.

The government will also consider PAAPAM’s proposal for removal of Regulatory Duty on ‘auto grade steel’ in the forthcoming budget 2017. Chairman Board of Investment (BOI) Dr. Miftah Ismail added that Renault, Hyundai, and KIA assembly plants would ultimately help auto parts industry to grow. “Car market is expected to grow by 30% as existing OEMs are also investing in new plants,” said Miftah.

He said that Foreign Direct Investment is also coming to Pakistan through CPEC projects. He reiterated the government’s stance towards ensuring the laying of proper groundwork for FTAs between Pakistan and other countries in a manner that does not affect the production and export of local auto parts. “There is misconception among the masses that the government has introduced policies that encourage import of auto parts and machinery rather than encouraging the manufacturing of these parts locally in Pakistan,” said Miftah.

He spoke of the government’s efforts in bringing about a positive influx of interest and investments from several international players, and stated that the government would not bring policies that would harm the integrity of the country’s industries or discourage local manufacturers from actively producing and exporting their goods. Miftah Ismail also said that Regulatory Duties and Anti-Dumping Duties were imposed on import of steel materials, to protect the local industry.

However, we will fully support the local auto parts manufacturers in removal of these duties from ‘auto grade steel raw materials’ which are not manufactured locally. He stated that the possibility of signing FTA’s with several Asian countries, who intend to open trading links for the export of auto parts to Pakistan, are also been considered by the experts of the industry, and full consultation is being carried out with the auto sector as well.

The Guest of Honor at PAPS closing ceremony, Mr. Zubair Tufail, President FPCCI, said that Sindh is becoming the hub for auto engineering. “We already have a strong presence of the car, two wheeler and truck sectors. These auto sectors present in Sindh fully reflect the Japanese technology and practices being implemented by Auto Parts Manufacturers based in this province,’ said President FPCCI.

He said joint ventures and technology collaborations take place through this platform between the companies present here today.

“The Sindh government has announced three Special Economic Zones, for foreign investors with lucrative incentives. International Special Economic Zone (ISEZ) will include an Expatriate Enclave with modern infrastructure and tax incentive package such as exemption of custom duties and taxes strictly on import of capital equipment,” he added.

Source: Pakistan Observer