'Pakistan emerging in S Asia as competitive automaker'

KARACHI: The local auto sector has built its capacity to become a competitive market in the region.

These views were expressed by leading local auto-parts makers.

"Pakistan is emerging in South Asia as a competitive auto maker and the hub of manufacturing sector. This is the time to take advantage of its productivity, innovation, research, and development to tap the international market while increasing exports and creating job opportunities for poverty alleviation," said Abdul Nasir, CEO, Alba Engineering Company.

Auto sector in Pakistan has around 3 million employees associated directly and indirectly. Auto industry has enabled about 100 Technical Agreements for the transfer of technology that helped increase productivity of workers and innovation. Presently, there are more than 350 registered members producing parts for the local auto industry.

"Our local auto parts manufacturing sector has invested heavily in improving plant productivity, automation and enhancement of manpower skill levels, thereby ensuring sustainable growth of the sector," said Munir K. Bana, CEO, Loads Ltd.

Meanwhile, local vendors since 1988 have been pursuing for technical and managerial skills from leading Original Equipment Manufacturers (OEMs) established in the country, the local auto parts manufacturing sector entered into a new era as a local company announced to export Absorber FR Bumpers to Toyota Motor Vietnam, thus joining the league of global auto parts suppliers for Toyota's international supply chain. Only consistency in policies can help achieve the long-term objective of automobile exports. Moreover, local companies are making efforts to enhance exports as they were essential for accelerating economic growth in the country.

"We believe technology upgradation will play a critical role in Pakistan's exports and overall industrial growth. Companies must invest in technology either through innovation or acquisition of technology via technology transfer and joint ventures agreements. This will serve both the automotive industry and the overall industrial development of Pakistan. To this end, the Government can play a key role in assisting companies via their various trade support organisations," said Usman Sadiq, CEO, Plastech Autosafe (Pvt) Ltd.

Moreover, localization as a main factor will increase export in the long term. The vendors and the local industry have been doing their best for localization and with an average of 50-70 percent localization in locally produced cars; the industry has come a long way.

Another factor which is very essential for the economy's growth is the growth of other sectors including capital intensive and labour intensive industries like steel, glass, rubber, asphalt, wood, gasoline, insurance, and road-construction industries etc; while auto sector grows in tandem with these sectors.

"Localization has two phases, first to develop parts meeting all engineering standards. The second phase, producing with consistent quality, timely and meeting cost expectation. This requires technology and management skills. Japanese OEM's along with JETRO and JICA have provided ample opportunities to acquire knowledge and have created an enabling environment to localize more. For this to happen, all we need is consistent and predictable government policy. Without this, we can only hope," said Mehdi Ali Rizvi, Director, PCI Automotive (Pvt.) Ltd.

The government must focus on post-COVID-19 era and help the sector to plan on long term basis. Consistent policies will create thousands of new jobs and help the national exchequer receive more revenue. So by taking on board the sector, Government should provide an environment where our industry can further work aggressively on the localization of parts manufacturing in Pakistan. Moreover, the issues which are hurting the industry such as higher duties and taxes, illegal use of import of used cars scheme and impact of higher input cost must be addressed.

Copyright Business Recorder, 2020