The government has amended the Import Policy Order (IPO) 2022, and now vehicles driven up to 2,000 kilometers will be considered “new”. Earlier, the limit was 500 kilometers, and reports suggested that the step is taken to avoid detention of such vehicles by Customs at the ports.
Announcing the change in a new S.R.O 430 (I) 2024, the Ministry of Commerce mentioned, “In exercise of its powers, the federal government is pleased to direct an amendment in the policy and for the figure “2000” will replace the figure “500”.
Reported Reason
According to market experts, the ministry announced this change after repeated requests from few influential entities because some vehicles are stuck at the port due to issues of extra mileage. The IPO 2022 earlier mentioned that a “new vehicle” means “vehicle manufactured during 12 months till the date of import and should not be registered or used more than 500 kilometers before the import.”
As per a media report, the ministry has decided to announce the release of the vehicles on account of road travel of these vehicles crossing the limit of 500 kilometers from the factory warehouse to the port. That is why, considering the unique circumstances faced by the importers, vehicles driven up to 2,000 kilometers will now be considered new, and it would help avoid detention at the port by Customs authorities on a regular basis.
However, a car importer clarified that this would apply to cars imported under the Letter of Credit (LC) and would not impact the other car importers.
The proposal was earlier approved by the Economic Coordination Committee (ECC) and the Federal Cabinet.
In the last couple of years, the governments imposed serious curbs on imports, and the reason was the cash-strapped economy and to preserve the forex reserves. This relaxation will have a positive impact on car imports; however, the coming months will tell the actual impact of this amendment.
What do you think about this change in the Import Policy Order? Is it a good step by the government? Please tell us in the comments section.
