On Thursday 27th December 2018, the PTI government in a meeting informed the Senate Standing Committee on Industries and Production that it would carry out the Auto-Development Policy (ADP) 2016-21 without any change.
At the meeting, Abdul Razak Dawood, the Prime Minister on Commerce, Textile, Industry, Production and Investment said that there shall be no change in the ADP it will remain as it is introduced by the previous government in March 2016. He said that “We will focus on increasing vehicle production in the country as Pakistan is a big country; demand is high while production is low.”
The committee was told that in Pakistan, about 55-70% spare parts of cars were being produced locally.
Senator Sitara Ayaz asked the question regarding the Greenfield status being given to the Pak Suzuki Motor Company, to which Abdul Razak Dawood said that Pak Suzuki Motor had asked for changing the investment under this auto policy. Therefore, the govt would be giving Greenfield status to Pak Suzuki Motor Company’s proposed $460-million investment. He also stated that “ with an investment of $460 million along with its existing plant, the company wants to build a new plant”.
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However, the commerce advisor also mentioned that this decision would be finalised after the consent of all the stakeholders. If any stakeholder doesn’t agree then Greenfield status won’t be given to Pak Suzuki Motors.
Investors will be allowed to have 20% exemption from customs duty under this investment category of Greenfield. Mr Dawood also mentioned that for this new technology for Greenfield status, the negotiations are being carried out between auto manufacturers and government.
The committee was informed that around $ 1.6 billion is to be invested from Japan, South Korea and China under this policy. This policy would be allowing 13 new car manufacturing companies to invest in Pakistan who would be focusing on the manufacturing of motorcycles, cars and trucks.
The committee was also informed by the representative of Indus Motors Company that due to the incompatible petroleum products, the company was not manufacturing Euro-V vehicles. Thus, the committee asked to ensure that the higher officials of the local car companies should be present in the next meeting in order to brief on the unsatisfactory GDP, availability of cars and their prices.