Used car imports are observing a massive increase as importers have found a way around the current import policy.
The importers are implying a method in which, passports of Pakistanis residing in Dubai are being used effectively to import cars into Pakistan. The government authorities are clueless about this exploitation of the policy. This method of import has been titled as the gift scheme but contradicting to it, the vehicles directly reach Pakistan.
“The number of imported used cars has increased in the current financial year as so far 1,096 cars have been imported, of which more than 560 units came in September,” said an official who was aware of this recent development.
It is important to mention that after the issuance of SRO 52, the misuse of used car import schemes had been successfully handled. It not only stopped the exploitation of the schemes but also halted payments of illegal imports.
“It is alarming that the importers have once again found a way to continue with their plans, which are denting the domestic auto industry, as the number of imported vehicles has increased in recent months,” he added.
The official was adamant that this may also impact efforts made by Pakistan to come out of the Financial Action Task Force (FATF) grey list as used car imports were one of the biggest contributors to the undocumented and illegal transactions. He stressed that the government should immediately take notice of the issue and halt the practice before it gets worse.
Meanwhile, Pakistan’s auto sector is going suffering tough times with many analysts terming the current phase an all-time low in the history of the industry. Initially only three domestic players dominated the market. However in the recent years, some new companies shown interest in investing in the sector in the past couple of years.
According to details, a total of 467 passenger cars have been imported so far during the current fiscal year, of which more than 250 units were imported in September.
The events of the past two years have negatively affected the existing players, therefore bringing the whole sector down. Several rounds of currency devaluation along with new levies (Taxes) have affected the car maker’s profits significantly.
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17 November, 2019