The new policy by the federal government, which has made prior approval from the State Bank of Pakistan (SBP) for the goods essential, has created serious hurdles for the auto industry. As per details, this mechanism is causing issues in the arrival of completely knocked down (CKD) kits of vehicles along with other major auto industry imports.
The media reports have suggested that a delay in approvals for CKD kits import transactions would cause a production halt for all major car companies by the next week. It would also disrupt the entire supply chain, including local vendors and dealers. And this whole situation can cause the unemployment of daily wage and contract workers.
PAMA Director Meets SBP Governor
During a meeting, Director-General Pakistan Automotive Manufacturers Association (PAMA) Abdul Waheed Khan told SBP Governor Dr. Murtaza Syed that payment delay gives a bad impression to foreign suppliers. “It creates a huge business risk for beneficiaries for exporting goods to Pakistan,” Khan said, adding that it would hurt the local auto sector in the long run.
Khan urged the SBP governor to provide timely approval for CKD imports. “This would help in production, protect the employment and restore foreign investors’ confidence in Pakistan,” he added.
Ban on CBU Imports
Last month, in an extreme measure to control the rising import bill, the government imposed a complete ban on importing nearly 800 items in 33 categories. Used and new cars were among the banned items.
Information Minister Marriyum Aurangzeb said this is an emergency situation, and Pakistanis have to make sacrifices and cut down their dependency on imports. She claimed that this move would save the country $500 million monthly. Under the new policy, the government banned the import of all used and new CBU (Completely Built-Up) cars under the SRO598. Only commercial vehicles import were allowed.
