Pakistan Businessmen and Intellectuals Forum (PBIF) President Mian Zahid Hussain Wednesday said that to improve automobile sector, regulatory duties on the import of raw material and auto parts must be rationalised and the recommendations of registered trade associations including PASPIDA, PAAPAM and PAMA may be given due consideration.
He was of the view that with the implementation of Automotive Development Policy in its true spirit, the auto sector contribution to GDP will be increased from 2.3 percent to 3.8 percent; share of auto sector in industrial production will rise from 22 to 30 percent besides this sector will employ 4 million masses in the country.
The existing potential in this sector may be opportunity for the small medium enterprises and local as well as foreign investors. Mian Zahid Hussain said Pakistan is 6th most populous country after China, India, US, Indonesia and Brazil with a population of 197 million. Fifty-four percent of our population is below 30 years of age, which shows 100 million young potential consumers of the auto industry. In this decade, the annual motorcycle production has increased to 2 million from 50,000 just because of the growing young population.
In Brazil, 260 people own vehicle out of 1,000, the count is 80 in Indonesia while it's just 15 in Pakistan, which shows the huge potential market for auto sector. Given to urbanization and improved living standard, increasing vehicle's sale is expected in coming days. He said that investment in automobile sector is not only profitable but also easy which can benefit the local and foreign investors equally.
There is no barrier to enter the business and comparatively a safes sector for investment. New investors will have the edge of filling the huge demand supply gap. There is demand of 1 million vehicles per annum while local companies produce only 2.5 lacs vehicles while 70 thousand vehicles are being imported annually.
Approximately 7 lacs used cars are being traded annually which indeed is a rich opportunity to be grabbed by the new investors. Mian Zahid Hussain said that the auto sector has shown high growth during the decade 2008 - 2018 where 97 percent growth has been observed in the production of motorcars and pickups, 92 percent growth in production of buses, 99 percent growth in Jeep's production and tractors' production have been increased by 92 percent.
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