I am going through the same kind of situation where I've this 89 model mehran, I have done few tricks of mine to make it a bit fuel efficient and looking forward to do the same as you intend to (putting 660cc japanese engine).
What I have done with my car:
1.Changed from point to CDI system.
2. Spark plug wires from the distributor replaced with good gauge.
3. good quality spark plugs.
5. Good quality Italian CNG kit.
6. Using ZiC oil.
Fuel efficiency increased a bit after all the aforementioned measures.
The Mehran engine which is already there is F6B which puts out about 34 Basic Horse Power, which is miserable.
The old engines available in the Market (Shoba Bazar, Peshawar) may be old and at the brink of their useful life but it is a fact that an F6A engine puts out 50 to 60 Basic Hourse Power and will be a good deal if I could source a good quality. So, keeping that in mind I am strongly in the mode to go for a F6A engine about which little that I know of as I am not a mechanic but I would search the internet and the market to gain more knowledge aobut this engine.
Bottom line:
A Japanese engine is definately a good idea to swap it with your old mehran engine.
Sincerely Yours
Naeem Zahid
Peshawar.