The Pakistan Automotive Manufacturers Association (Pama) has decided to seek an immediate appointment with Prime Minister, Finance Minister and other concerned ministers to explain the detrimental effects the proposed budgetary measures will have on new investment, on the viability of the vehicle industry of the country and on the engineering industry as a whole.
The decision was made in an emergency meeting of the association, chaired by Kunwar Idris, chairman of Pama, and attended by chief executives of entire car manufacturing companies.
They expressed serious concern on the drastic reduction in duty on import of completely built-up cars.
They noted that the new scale of duty on CBU cars reduces the protection to local manufacturers to 15 percent which is wholly inadequate for Pakistan's small and struggling engineering industry. Even in more developed and larger economies like India and Thailand the protection is much higher.
They noted that the new duty structure would bring to a halt the huge investments planned in the expansion and modernisation of the engineering industry.
The localisation of parts which now stands at 50 percent or more will come to a standstill or may even fall back.