Where the prevailing economic calamity leading to the staggering inflation and import restrictions has taken a heavy toll on Pakistan’s auto industry, the sector is flourishing in neighbors – gearing up to welcome the EV giant Tesla in its car market.
Reuters reported that Tesla proposed an EV plant in India to assemble electric cars for domestic market and export purposes. Earlier, the Indian government refused Tesla’s request to lower the import tax on vehicles which its CEO Elon Musk found the highest in the world. India urged Tesla to sell locally produced cars in the Indian market. While the company was interested in testing the market before setting up a factory. However, the talks concluded in a deadlock.
The recent development came a year after the company put the plan on hold in the face of failing to secure a low in car import taxes. Tesla didn’t discuss lowering the import taxes with Indian officials in private talks. Senior Tesla executives are in India this week to meet officials from Modi’s office and discuss sourcing of parts and other related issues.
It bears mention that local sources align making cars locally with Indian Prime Minister Narendra Modi’s plan to attract foreign companies with the “Make in India” campaign.
Situation In Pakistan?
On the contrary to India, the Situation of the car industry in Pakistan is entirely different. Car sales and production and auto financing are performing worst for a long time – even marking a new low every month.
Car sales have been down by 85% on year-on-year bases in April 2023. Auto loans observed a 10th consecutive drop last month. The automotive industry in Pakistan has laid off thousands of workers in the last few months as production and sales of vehicles declined by almost 70%. And as per analyst, the industry may witness more bad times if the ongoing economic fuss persists.
