The Industries Ministry has decided to allow import of ''black cabs'' on the analogy of tractors scheme, which has been, interestingly, quashed by Sindh High Court.
Sources in Finance Ministry told Business Recorder that the new scheme was being launched in the light of a decision taken at a meeting under the chairmanship of President Pervez Musharraf and consequent directive from the Prime Minister. "Import of ''black cabs'', on the analogy of tractors, will be allowed subject to payment of customs duly at the same rates for CKD and CBU, for taxi operation only," sources said quoting the decision.
They said that in the light of Prime Minister''s directive, a summary was submitted for constitution of a subcommittee to formulate the modalities/procedures and to evolve implementation mechanism for the directive.
The Prime Minster approved the constitution of subcommittee under the chairmanship of Secretary, Ministry of Industries, with representation from Ministries of Finance and Commerce, Central Board of Revenue and the Board of Investment.
However, Prime Minister also desired to include in the subcommittee the Additional Secretary (EA) of PM secretariat and a representative from the private sector.
Sources said that the subcommittee recommended that 300 black cabs, in CBU condition, be allowed to be imported at the rate of 35 percent custom duty, being the rate applicable for CKD in the case of cars, on the analogy of tractors.
In case of import of tractors, the rate applicable for CKD (zero percent) was allowed for import of the tractors in CBU condition.
Sources said that the scheme was being launched to accommodate a party which intends to import black cabs in the name of ''international transport company'', with paid up capital of Rs one billion.
However, the subcommittee approved a policy containing the qualifying criteria/procedure for consideration of bids, which would be advertised for information of all companies interested to take part in the scheme.
The qualifying criteria/procedure will be as follows:
a) The intending companies may be required to provide proof of steps taken for establishing local assembly/manufacturing plant ie land acquisition, technical agreement with foreign firm for joint venture, plan for annual production capacity and plan for setting up after sale service in the country.
b) Verification of bids/proposals received for import of taxi cabs on the basis of the above criteria may be conducted by the sub-committee. The subcommittee may employ the assistance of Engineering Development Board (EDB) for this purpose.
c) The companies may be required to establish LC within 90 days and the process of import and delivery for taxi cars be completed during 2006-07.
d) The companies concerned may be required to submit bank guarantee equal to the amount of duty waived as a concession under this policy. The bank guarantee will be released in the following manner:-
50 percent in opening of irrevocable LC for import of plant & machinery while balance 50 percent on roll-out of first taxi cab through local assembly/manufacture.
The company will start manufacturing within 18 months of approval by the government.
The Ministry, however, has made it clear that the imported/locally manufactured cabs would be "purpose built" and may not be used for any purpose other than taxi operations.
The fleet of such taxis may be operated by a company with substantial paid up capital, incorporated for this particular purpose.
In addition, these taxi cabs may not be transferable, except to recognised taxi fleet operators, and the transfer would be made in the form of lots only, with each lot being at least 50 in number will be allowed.
Sources said that the Economic Co-ordination Committee (ECC) of the Cabinet is likely to approve the scheme in its next meeting.
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