Central Board of Revenue (CBR) Chairman Abdullah Yusuf has assured the auto sector that import duty had been temporarily reduced to fill the demand-supply gap, and there was no need for concern.
He was speaking as chief guest in Indus Motors 'Annual Vendor Convention 2005' here on Saturday.
The CBR chief told the vendors and auto original equipment manufacturers (OEM) that the government was aware of the problems faced by the industry due to the reduction in import duties. "The Government acknowledges the substantial investment, and capacity enhancement undertaken by OEMs and the vendors to meet the huge demand. However, keeping in view the macro-scenario and its political responsibility, the government has temporarily reduced the import duties to minimise the demand-supply gap. The objective is not to open floodgates for import of vehicles and damage the local industry" he said.
Abdullah also reaffirmed the government's objective of providing an investment-friendly framework to the auto industry. "We intend to increase investment from 15 percent of GDP to 20 percent, which is essential to sustain the high level of economic growth, and this, the auto sector, is the predominant player. The government does not want to yield to the pressure of used cars in the national interest. We have no doubt in mind that we have to protect the auto industry by building up confidence and enhancing investment in a conducive business environment" he added.
He appreciated Toyota's 65 years history and its phenomenal growth and urged the industry and vendors to derive motivation from Toyota and go beyond import substitution, targeting the potential of export markets. "Our fast growing local market should be considered as a jumping ground for focusing on exports. The industry will not only need to increase capacity, but will also have to become globally competitive," he stressed.